translated from Spanish: In 2020 there will be a ‘modest recovery’: Banxico

By 2020, the Mexican economy will have a “modest recovery”, but an environment of marked uncertainty will persist, so the balance of risks for growth remains scless downward, the members of the Governing Board of the Bank of Mexico (Banxico) pointed out.
According to the minutes of the last members’ meeting this year there could be a recovery in the economy as the T-MEC will be approved; the public administration is more prepared to operate; and there is a low probability of a repeat of the negative events that occurred in 2019. 
They even considered that a moderate recovery in private consumption is expected, driven by consumer confidence, remittance income and wage mass. 
Read: Banxico analysts expect the economy to grow 1.10% by 2020; estimate the dollar at 20.10 pesos
However, they predict that economic weakness in Mexico will persist, as has happened in past quarters, because it remains in stagnation.
While the available information for the fourth quarter of 2019 is limited, “the weakness that economic activity in Mexico has been experiencing for several quarters is estimated to persist”.
At the last meeting held before the conclusion of 2019, on the occasion of the monetary policy decision, the majority decided to lower the interest rate for the fourth time to 25 basis points and leave it at 7.25%.
This was with the exception of the Deputy Governor of the Bank of Mexico, Gerardo Esquivel Hernández, who was the only one to vote in favor of reducing the interest rate to a level of 7.0%.
Find out: Economy, with zero growth in the first 9 months of 2019
According to the minutes, the members of the Governing Board of Banxico noted that economic activity is complicated not only by the limited information available, but also as a result of the effects of temporary factors that have affected the automotive sector in Mexico.
The fall in automotive production is due to the change of production lines in various shipowners and the impacts caused by strikes in that sector in the United States, which led to a decrease in exports to that northern neighbor.
Another member of Banxico said that the stagnation of the economy is the result of several factors such as the external environment, as U.S. manufacturing output contracted over the past year.
It is also because each start of the six-year crisis is recorded as a slow slow exercise in spending and a restrictive monetary policy, which has affected consumption and investment.
Public investment still reflects a lack of resources and private investment has resented for several years the uncertainty around the business relationship in North America and other internal factors, according to the minutes.
Read: Growth was not important, Slim says; it is idle to discuss stagnation, says the CCE
Official data show that investment reached 20.9% of Gross Domestic Product (GDP) in the third quarter of 2019 and, of that total, 18% is for entrepreneurs and only 2.9% has been allocated by the public sector.
Added to this is the loss of dynamism in manufacturing, mining and construction production over past months, and there has been a continued slowdown in the services sector.
“The stagnation of economic activity has meant the expansion in the negative terrain of the conditions of slack of the economy compared to what was observed in the previous quarter,” they concluded.
Here you can read Banxico’s full report.
With information from Notimex.
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Original source in Spanish