Economic Analysis - Fiscal Consolidation Efforts Paying Off - DEC 2017

BMI View: C onsolidation efforts will see a narrowing of Mexico's fiscal deficit in 2017, as the government reduces capital expenditures substantially. A gradual recovery in the oil sector will support revenues, underpinning our view for less substantial shortfalls over the coming years.

  • Mexico's budget deficit will see narrower budget deficits in the next few years as the government continues its fiscal consolidation efforts and benefits from steady revenue growth.

  • We have upgraded our fiscal forecast for 2017 and now expect Mexico's deficit to reach 1.3% of GDP as expenditure growth has been weaker than previously anticipated.

  • Fiscal Situation Improving
    Mexico - Overall And Primary Budget Balance, % of GDP
    f = BMI forecast. Source: Banxico, BMI

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