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Tuesday, July 16, 2024

Mexico cuts 2015 growth forecast

MEXICO CITY – Mexico again slashed its 2015 economic growth forecast Thursday after its expansion in the second quarter came in at a sluggish 0.5 percent.

Latin America’s second-largest economy will grow between 2 and 2.8 percent this year, the Finance Ministry predicted, lowering its previous forecast of 2.2 to 3.2 percent.

The earlier prediction was itself revised down by one percentage point in May after weak first-quarter growth of 0.4 percent.

Mexico’s Central Bank last week cut its own economic growth forecast for 2015 to 1.7 to 2.5 percent, down from 2 to 3 percent.

The country has been hit hard by falling oil prices, complicating President Enrique Peña Nieto’s ambitious reforms of the oil sector.

The business community is also nervously watching the Mexican peso’s slide — down more than 20 percent against the dollar in the past year — and U.S. moves to raise interest rates, which will put more downward pressure on the peso and cause investors to pull money out of emerging markets.

Mexico’s economy grew 2.1 percent last year, falling well short of the government’s initial forecast.

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