Mexico's manufacturing sector continues to contract amid the COVID-19 pandemic, but the rate of decline is the slowest since the pandemic hit, Reuters reported.
In July, the IHS Markit Mexico Manufacturing Purchasing Managers’ Index was at 40.4, a small increase from June's 38.6, Reuters said.
Despite the increase, June's reading is still far below the 50 threshold that indicates the sector is expanding, the story said.
Mexico's economy shrunk by 17.3% in the second quarter of the year as the pandemic forced factories to shut down, kept tourists and shoppers at home, and threatened trade agreements, the story said. In April, the manufacturing index was at 35, the lowest point in the nine-year history of the survey. Since then, it has been gradually recovering.
"The latest PMI data suggested that the Mexican manufacturing sector is continuing to struggle amid the COVID-19 outbreak," Eliot Kerr, an IHS Markit economist,told Reuters. "Although rates of decline in output and new orders eased further from April’s records, the overall contractions remained sharp.”
The PMI is a monthly index that indicates the overall health of an economy. It's based on a monthly survey sent to senior executives in 19 primary industries.
The International Monetary Fund predicts Mexico’s economy will shrink by 10.5% this year, Reuters said.
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