Up, up, down.

The Bank of Mexico has cut its 2017 growth forecast after lifting it twice this year as the devastating earthquakes and hurricanes that lashed the country in the third quarter took their toll on the economy.

In its quarterly report — the final one to be presented by Agustín Carstens, who leaves his post as governor on November 30 to head the Bank for International Settlements – Banxico is forecasting 2017 growth of 1.8 to 2.3 per cent, down from the previous estimate of 2 to 2.5 per cent.

Mexico’s economy contracted in the third quarter as the slew of natural disasters hammered oil production, but the bank says the impact will only be temporary. It also stuck to its expectation that inflation, now running at 6.37 per cent, peaked in August and will converge to the goal of 3 per cent, plus or minus one point, by the end of 2018.

Banxico had lifted its 2017 goal from an earlier estimate in the second quarter of 1.5-2.5 per cent, which it had in turn nudged up from 1.3 to 2.3 per cent at the start of the year.

Banxico is still forecasting 2-3 per cent growth next year, below the IMF’s target. Concluding its Article IV consultation earlier this month, the IMF pencilled in growth of 1.9 per cent for 2018 from 2 per cent targeted back in July.

Mr Carstens’ replacement has not yet been announced.

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