Business confidence in Mexico dives to 42-month low: S&P Global

By Ovunc Kutlu

ISTANBUL (AA) - Business confidence in Mexico plummeted in May to its lowest level in 42 months, S&P Global said Monday in a report.

"International sales continued its descent, while delivery delays negatively impacted inventories and drove a substantial rise in backlogs," it said.

The global data provider noted that cost inflation in the North American country in May climbed its highest level in 17 months.

"Subdued demand from Central America, Japan and the US hampered international sales, while worries around competition from mainland China, insecurity, water shortages and election uncertainty dragged down optimism to a three-and-a-half-year low," said Pollyanna De Lima, economics associate director at S&P Global Market Intelligence.

"On the plus side, demand resilience and the successful launch of new products boosted sales growth and induced a renewed increase in output," she added.

Mexico's Manufacturing Purchasing Managers’ Index (PMI), however, slightly rose to 51.2 in May, adding 0.2 points from 51.0 in April, which indicated "a marginal improvement in the health of the sector," according to the report.

New orders, meanwhile, increased for the fourth straight month in May, and factory output rose for the third time in four months, according to the report.