LatinNews Daily - 30 May 2024

*Mexico’s central bank (Banxico) has released its quarterly report for the first quarter of 2024 in which it reduced its 2024 GDP growth forecast to 2.4% down from its previous 2.8% forecast made in February which was down from its previous November forecast. In its report Banxico cited a “prolonged economic slowdown from late 2023 into early 2024”. However, Banxico retained its 1.5% growth estimate for 2025. Banxico identifies as primary risks to growth: reduced external demand from the US; escalating geopolitical tensions; tighter financial conditions; market volatility; and adverse weather events impacting economic activity, among other things. In its report, Banxico also forecast annual inflation of 4.0% in the last quarter of 2024, up from its previous (February) estimate of 3.5%. It notes that inflation had increased from 4.41% in the fourth quarter of 2023 to 4.57% in the first quarter of 2024, and that in the first two weeks of May 2024, inflation was 4.78%. However, it expects inflation to converge to the target rate of 3% in the fourth quarter of 2025.