MEXICO CITY (Reuters) – Mexico’s fiscal deficit will widen to 4.1% of gross domestic product this year, ratings agency Moody’s Investors Service said on Wednesday, with ongoing support for ailing state oil company Petroleos Mexicanos being the main driver for the increase.
Pemex, as the indebted oil company is known, will need $14.7 billion in government support this year alone, the ratings agency said in a statement.
This support will be a key driver of the increase in the fiscal deficit, Moody’s said.
Meanwhile, Mexico’s real GDP will likely grow at 5.5% this year and at 2.6% next year held back by sluggish domestic demand because of persistently weak investment and a weak labor market that are weighing on consumption.
(Reporting by Stefanie Eschenbacher; Editing by Daina Beth Solomon)
