The good momentum of the Mexican economy, records in macro indicators, expect the economic and political balance to be reflected in the June 2 vote.
Last week, the Ministry of Economy announced that FDI inflows of $20,313 million between January-March this year, nine percent higher than the same period in 2023 and a historic high in the first quarter.
With a sense of continuity in economic policy, according to Janneth Quiroz, director of economic, exchange and stock market analysis at Monex, there is confidence in investment as well as in exchange stability motivation.
These data include growth in the consumer confidence index, a very low unemployment rate, as well as a 90 percent increase in the minimum wage in real terms since 2018, which are deciding factors in the election.
Accordingly A Comparative Study of Electoral SystemsWhen a person perceives improvement in the economy, the probability of voting against the ruling party or coalition is very low.
Leading presidential candidate Claudia Scheinbaum, the macroeconomic head of President Andrés Manuel López Obrador’s administration, called on Treasury Secretary Rogelio Ramírez de la O to remain in office if he wins the election. The Punishment moment – Highlighted by Clara Brugada, the successor of Marti Padres in the CDMX government – expects discipline and determination, and, contrary to conventional expectations, the undervaluation of the stock market.
Historically, economists such as Robert Shiller have highlighted the tendency of investors to take a more moderate view in their assessments of financial markets during times of economic stability. Additionally, high FDI can put pressure on stock market valuations.
Although undervaluation is often associated with economic problems, it can also be the result of a stable macroeconomic environment, with investors taking a more cautious and realistic stance.
The challenge for 2024 is to consolidate the democratization of the stock market in Mexico, where more companies, especially small and medium-sized companies, can be financed through equity instruments.
Individual economics, macroeconomics and the stock market will play an important role in the electoral process.
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Salvador Guerrero Cipres is the president of the Citizens’ Council for Security and Justice of Mexico City.
TW: @guerrerochipres
Twitter: @elconsejomx
The views expressed are entirely independent of the responsibility and position and editorial line of their authors Forbes Mexico.
