Mexican Retail Sales Impress
The consumer sector in Mexico continues to remain healthy according to the latest update to the nation’s Retail Sales data this morning. Month on month the Retail Sales number has just been reported as 0.4%, this represents an increase over the July reading of 0.2%, there was no anticipation for a change to this figure today. The year on year retail sales picture also remains strong, the latest reading is showing growth of 2.0% in comparison the prior month’s 1.1% the market forecast of 2.2% was however slightly missed.
Global interest is growing in the Mexican economy as it begins to become evident that it’s future financial trajectory is more than just that of another emerging market economy. Obvious factors such as the proximity of Mexico to the US and it’s close trade links will no doubt contribute to growth over the coming years, particularly as the US economy continues it’s current phase of expansion. Significant increases in the quality and pervasiveness of education over the past two decades are now also beginning to manifest themselves as higher incomes and rising consumer expenditure fuelling domestic lead growth.
The real boost for the Mexican economy is however likely to come in the form of far reaching structural reforms. The administration of President Pena Nieto has struck an unprecedented deal with the main opposition parties to ensure that these much needed reforms can be passed successfully. Mexico has been attempting such reform for many years but political disagreements weakened the administrations hand and made it impossible to take on the strong vested interests within the economy. The broad political agreement on this occasion holds the potential to overcome these blocks in the interest of national progress. The most significant progress to date came last month when the legislation to open up Mexico’s energy production markets to private investment was signed into law. If future reforms can be as effectively introduced as this recent energy deregulation then there is strong potential for the future growth of the Mexican economy.
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