Mexican President Andrés Manuel López Obrador AFP

Mexico's economy could expand by more than 3.5% this year, says Deputy Minister of Finance and Public Credit of Mexico Gabriel Yorio.

Speaking before the senate, the deputy finance minister said Wednesday that the country can expect an expansion in its gross domestic product (GDP). He noted the government debt may land at around 47% of GDP in 2023 and it can go up to 49% the next year.

He shared that there are no signs that the Mexican peso rate, which increased by 14% compared to the U.S. dollar in the first half of the year, was creating a negative impact on the export sector.

The annual inflation is expected to stabilize around 4.5% by the end of this year.

Bank of Mexico board member Jonathan Heath had a warning on the country's economic situation. He said the inflation is setting in slowly and due to its slow pace, one should not celebrate prematurely.

"Inflation continues its downward trajectory, however, we're not even close to singing victory. We still see a long battle ahead and this inflation phenomenon has really been much more complex than we would have imagined," Heath noted, Reuters reported.

The comments came as the central bank has left its benchmark interest rate unchanged at 11.25% since March.

Mexico is the second-largest economy in Latin America. The total value of Mexico's exports was $494,596 million in 2021, whereas the import value was $506,565 million, according to a World Bank report. The United States is one of its biggest trade partners.

The country exports various products, including cars, motor vehicles, their parts and accessories, computers, delivery trucks and crude petroleum to countries like China, Canada, the U.S., Taipei and Germany.

Its imports include products like refined petroleum, office machine parts, integrated circuits and petroleum gas from several countries, including the U.S., China, Germany, South Korea and Japan, according to the Observatory of Economic Complexity.

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