The economy entered a light recession in the first half of the year, according to revised data published Monday that also showed that third-quarter growth was lower than first estimated.
The national statistics agency, Inegi, reported that the economy contracted 0.09% in the first quarter and 0.06% in the second. It also said that GDP shrank by 0.1% in the last quarter of 2018.
In addition, Inegi reported that growth between July and September was just 0.01%. Preliminary figures published at the end of October showed a third-quarter expansion of 0.1%.
Initial Inegi data showed a contraction in the first quarter of 2019 but growth in both the last quarter of 2018 and the second quarter of this year, meaning Mexico had not entered a recession.
Most economists classify two consecutive quarters of negative growth as a technical recession. However, others take a different view.
Deputy Bank of México governor Jonathan Heath pointed out in July that the National Bureau of Economic Research, a United States non-profit organization, classifies a recession as a period in which there is a significant downturn across all sectors of the economy as well as higher unemployment and lower industrial production, among other indicators.
He acknowledged that there has been a downturn in the economy but charged that it was far from “significant.”
Health also said that not all sectors of the economy have contracted, pointing out that manufacturing has grown, albeit at a slow pace.
Alonso Cervera, chief Latin America economist for Credit Suisse, expressed a similar opinion on Twitter Monday.
“Some will say ‘see, we were already in recession.’ I call it stagnation more than recession. The decline in activity hasn’t been significant nor has it hit the whole economy,” he wrote.
Whatever way it’s interpreted, the revised data is bad news for President López Obrador, who has overseen a lackluster economy in his first year in office.
His pledge to achieve average 4% growth during his six-year term now appears more difficult to attain than ever.