Mexico industrial production plummets to historic low

(C) Reuters. FILE PHOTO: Outbreak of the coronavirus disease (COVID-19), in Silao

MEXICO CITY (Reuters) – Mexico’s industrial output posted a record contraction in April as measures put in place to stem the spread of coronavirus dragged down construction, manufacturing and utilities, official data showed on Thursday.

Industrial activity tumbled 25.1% in April from March and was 29.3% lower year-over-year, both historical lows, according to figures from the national statistics agency, INEGI.

Goldman Sachs (NYSE:GS) economist Alberto Ramos said in a note to clients that industrial production likely touched bottom in April as some key economic sectors are gradually reopening.

Automakers, mining firms and builders, deemed essential activities, have been given the green light to restart work, even as other sectors have been slow to exit the coronavirus lockdown as the pandemic continues to rage in Mexico.

“Lingering policy uncertainty, deteriorating business confidence, the severe decline in domestic and U.S. activity, and the growing spread of Covid-19 are likely to weigh on the broad industrial sector for a while,” said Ramos.