Overview of the Economic Indicators
This week, Mexico’s economic calendar includes reports on monthly economic activity, quinzenal inflation, and expectations from service, commercial, and construction companies. In the United States, analysts will focus on inflation data, which might rise due to the federal government shutdown.
Tuesday, October 21: Monthly Economic Activity Indicator (IOAE)
- Mexico’s Opportune Economic Activity Indicator (September)
- Results of the Mexican government securities auction
On Tuesday, Mexico’s Opportune Economic Activity Indicator (IOAE) will be released. This advanced estimate, published by INEGI, anticipates the behavior of the Global Indicator of Economic Activity (IGAE). Its significance lies in providing an early signal about the overall economic performance, aiding policy-making, financial analysis, and business planning.
Simultaneously, Banco de México (Banxico) will publish the results of the government securities auction, including Cetes, Bonds, and Udibonos. This report reflects investor appetite for sovereign debt and serves as a gauge of confidence in economic stability and interest rate trajectory.
Wednesday, October 22: Global Economic Activity Indicator (IGAE)
- Mexico’s Global Economic Activity Indicator (August)
- OECD’s Crude Oil Raw Stock Changes in the US
Midweek, the IGAE will offer an early glimpse into Mexico’s economic performance in August. Sustained growth signifies dynamism in key sectors like manufacturing, services, and trade. A weak figure usually predicts deceleration and policy challenges.
In the US, the OECD’s report on crude oil raw stock changes will be released. This key reference helps anticipate energy price trends. A decrease suggests higher demand and upward pressure, while an increase indicates lower consumption. Both scenarios will impact oil prices.
Thursday, October 23: Inflation
- Mexico’s inflation (first half of October)
- Monthly Service Survey in Mexico (August)
- Monthly Survey of Commercial Companies in Mexico (August)
- New US unemployment insurance claims
On Thursday, INEGI will release Mexico’s inflation data for the first half of October, including general and underlying figures. This indicator is crucial for assessing the progress of the disinflation process and the Banco de Mexico’s room to continue its interest rate reduction cycle this year.
The Monthly Service Survey (EMS) will reveal the service sector’s evolution, a significant driver of Mexico’s economy. An increase implies internal market expansion and higher productive dynamism, while a decrease could signal weakening demand and slower GDP growth.
The Monthly Survey of Commercial Companies will display wholesale and retail trade performance, a vital component of consumption. Positive results indicate robust internal demand, while negative ones suggest cooling spending and potential inflation or interest rate effects.
In the US, new unemployment insurance claims will provide updated labor market signals. Their behavior will influence the Federal Reserve’s expectations regarding monetary policy adjustments. Data might be delayed due to the US federal government shutdown.
Friday, October 24: Construction Companies
- National Survey of Construction Companies in Mexico (August)
- US Inflation Report (September)
The week concludes in Mexico with the National Survey of Construction Companies, offering a snapshot of sector activity, crucial for public and private investment. Growth signals dynamism in infrastructure and construction, while a decline might reflect slowing investment.
The key data of the week is the US September inflation report. It’s pivotal for the Fed’s rate outlook for the rest of the year. Investors seek clarity after a 25-basis-point cut, but uncertainty may persist if the Democrats and Republicans fail to end the government shutdown.
