| | |  Business News | November 2009 
Mexico No Longer in Recession, Says President
 IANS
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November 06, 2009
 |  | The Mexican economy in the first half of the year shrank by almost 10 percent year-on-year, 'a truly brutal contraction.'
- President Felipe Calderon |  | | |
The Mexican economy grew 2.7 percent in the third quarter and has therefore climbed out of its worst recession in decades, President Felipe Calderon has said.
'This result is very good news because it indicates the end of the recession, of the economic contraction in the country and we're working hard so this recovery continues and broadens in the coming years,' the head of state said while inaugurating the Bloomberg Mexico Economic Forum in this capital Thursday.
In addition to the return to economic growth, the inflation rate came in at '4.6 percent in the first two weeks of October, the lowest level since May 2008', Calderon said.
The official gross domestic product figure will be provided by the National Institute of Statistics and Geography Nov 20, although most analysts and the Mexican central bank had already estimated that the economy grew at a clip of around 3 percent.
The Mexican economy began shrinking at the end of 2008, with a 1.6 percent drop in gross domestic product in the fourth quarter.
The GDP decline continued in the first two quarters of this year, falling 8.2 percent and 10.2 percent, respectively. The government is forecasting the economy will contract by 6.8 percent for all of 2009, while private economists say the figure will be closer to 7.2 percent.
The Mexican economy in the first half of the year shrank by almost 10 percent year-on-year, 'a truly brutal contraction', the president said Thursday, noting that there was a sharp slowdown not only in consumer demand but also in investment and bank lending to the private sector.
He predicted Mexico's economy would rebound to grow 3 percent next year and achieve growth rates of 5 percent in 2012, when Calderon's six-year term ends.
'We're determined to make our economic forecasts a reality. And beyond that, we want the country to be able to achieve sustained growth rates in the future,' Calderon said.
He pledged continued prudence in the 'handling of macroeconomic variables' as the country works to shore up troubled public finances that have been depleted by a fall in tax collection and a steady decline in oil output, Mexico's top source of revenue.
The president also pointed to a rosier employment picture, saying that '80,000 new net (formal) jobs' were created in the country in October, marking the fifth consecutive month that employment has risen.
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