Mexican gross fixed investment posts record jump in June, but still weak

MEXICO CITY: Mexico's measure of spending on machinery, equipment and new construction posted its biggest monthly rise on record in June after plummeting earlier in the coronavirus pandemic, figures from the national statistics agency showed on Monday.

Gross fixed investment rose by 20.1 percent in June from the previous month when adjusted for seasonal swings. Still, investment remained much lower than last year, the data showed.

Compared to June 2019, gross fixed investment was down 24.1 percent in unadjusted terms, continuing a poor run that stretches back to the outset of the administration of President Andres Manuel Lopez Obrador, who took office in December 2018.

January 2019 was so far the only month in which gross fixed investment rose year-on-year in unadjusted terms under Lopez Obrador, who has rattled investors by calling into question contracts signed by companies during the last government.

Lopez Obrador argues that previous governments he casts as corrupt skewed contracts in favor of private interests, and has moved to give the state a bigger role in the economy.

The resulting rows have caused delays to projects and the suspension of billions of dollars worth of investment, helping fuel a recession that began before the coronavirus pandemic.

The statistics agency's data on gross fixed investment published online date back to early 1993.