MEXICO CITY: Mexico's central bank on Wednesday upgraded its outlook for Latin America's second-largest economy, predicting growth of 4.8 percent this year, after a major slump in 2020 due to the pandemic.

The Bank of Mexico, which last month resumed its interest rate cuts aimed at reinvigorating the economy, had previously forecast growth of 3.3 percent in 2021.

The central bank said in its latest quarterly update that "economic activity remains below its level before the health crisis in an environment of high uncertainty."

It said that growth could miss or exceed its central forecast within a range of 2.8 to 6.7 percent depending on factors such as the pace of Mexico's coronavirus vaccination program.

Mexico's economy shrank 8.5 percent in 2020, according to official figures, in what analysts said was the worst slump since the Great Depression.

Mexico City and a number of other states went back on maximum alert in late 2020 as Covid-19 cases and deaths soared, resulting in the suspension of non-essential activities.

A fall in Covid hospitalizations has since allowed them to move to a lower alert status although restrictions remain on many non-essential activities.

The country of 126 million people has registered more than 187,000 known coronavirus deaths -- the world's third-highest toll.Mexico began mass vaccinations on December 24 but like many nations it is struggling to acquire enough doses.