Anthony Esposito and Noe Turres

MEXICO CITY (Reuters – Mexico’s Deputy Minister of Finance Gabriel Yorio claimed on Friday that any talk about a “technical” recession in Mexico does not take into consideration coronavirus-related financial volatility or global supply chain problems.

Mexico, which is the second largest economy in Latin America after the United States, saw its December growth rate drop to 0.2%, according to a preliminary estimate last week. This raises concerns that the country could be in recession by the end of 2021.

According to Reuters, Mexico’s economy is likely to have contracted over the past three months in 2021. This would be the second consecutive quarter of negative growth. Technical recessions are caused by this.

“We don’t think that talking about a technical recession captures the current economic dynamic due to the pandemic, and more importantly because of the supply shocks facing the world,” Yorio stated in a press conference.

Yorio said that global supply shortages and increased raw material prices are affecting the economy.

Some analysts have said the economic stagnation and high inflation that Mexico was experiencing was a recipe for stagflation https://www.reuters.com/business/mexicans-chafe-over-struggling-economy-surging-inflation-2022-01-27.

“There has been a lot discussion about stagflation. But we don’t believe that we’re currently in that situation,” Yorio explained.