Brazil’s S&P Global manufacturing PMI fell to 44.8 in September from 46.3, its weakest reading since April 2023. Mexico’s moved the other way, rising to 50.3 from 49.8. The figures, published in a regional market briefing dated Friday, October 2, 2026, show a region where growth, prices and public accounts are pulling in different directions.
Factory Data Diverges
Below 50 means contraction. Brazil’s reading sits well below that mark. Colombia’s Davivienda manufacturing PMI, by contrast, rose to 54.6 from 54.3. In the United States, the ISM manufacturing index came in at 54.5 against a forecast of 55, while its prices-paid gauge jumped to 77.9 from 71.1.
Mexico’s improvement comes with caveats. INEGI’s business confidence index edged up to 48.4 from 48.3, but that’s the 19th consecutive month below 50. The Mexican Institute of Finance Executives, known as IMEF, put its Manufacturing Indicator at 50.0 in September, up from 49.9. The group called the results “mixed signals” and said activity had stopped deteriorating as quickly, but the evidence wasn’t enough to confirm a broad recovery. Its non-manufacturing indicator, which covers services and commerce, rose 0.2 points to 49.2 and remained under 50.
IMEF linked the uptick partly to public investment in physical works, which rose between April and June, “very probably” because of the football World Cup. It also pointed to computer-equipment exports, which grew 200% through July. But most inputs came from Asia, leaving local value added low. The group named the review of the USMCA, the North American trade agreement, as the main exposure.
Fiscal Numbers and Prices
Mexico’s finance ministry, SHCP, reported a January-to-August fiscal deficit of MXN 739 billion, about US$40 billion at 18.30 pesos per dollar. The programmed figure was MXN 1.015 trillion. Still, IMEF said public construction spending fell 13% from June to July, while rigid spending and rising pension costs increased the chance of a sovereign credit-rating cut. It expects the Bank of Mexico to hold its interest rate for the rest of the year and sees upside risk to inflation, mainly from services.
Price pressure persists elsewhere. Peru’s INEI reported Lima annual inflation of 4.55% in September, up from 4.44% in August and above the central bank’s 1% to 3% target range. Chile’s Imacec activity index fell 1.0% year on year in August after a 1.5% decline in July, as copper mining dropped 17.4%.
Argentina’s tax agency, ARCA, reported September revenue of AR$21.36 trillion, about US$14 billion at AR$1,525 per dollar. That’s a 38.3% rise in nominal terms, following about AR$20.5 trillion in August.
Markets, the Dollar and Mexico’s Exposure
Brazil’s Ibovespa gained 0.46% on Thursday, closing at 187,197. It marked the third straight up day and sat roughly 6% below its 52-week high. The briefing described the rise as a local rebound rather than a regional signal. Mexico’s IPC fell 0.97% in the briefing’s regional setup, Chile’s IPSA slipped 0.56%, and Argentina’s Merval dropped 2.15%. Mexico’s IPC sits about 11% below its 52-week high.
The dollar hurt currencies. Per RT close data for October 1, USD/MXN rose 1.26% to 18.2965, USD/CLP climbed 1.40% to 986.18, and USD/BRL gained 0.84% to 5.2176. The briefing said a firm dollar raises the local-currency cost of foreign debt and weighs on imported inflation. Elevated oil prices, meanwhile, supported exporters in Brazil, Colombia and Mexico, including Petrobras, Ecopetrol and Pemex.
Among Brazilian stocks, turnover leaders were Itaú Unibanco at R$2,597 million, Vale at R$1,867 million and Petrobras preferred shares at R$1,697 million. Activity, the briefing said, concentrated in banks, oil and iron ore. Traders were also watching the US payrolls report due at 09:30 Brasília time, which could ease or increase dollar pressure depending on the result.
Why This Matters: The numbers point to economies where fiscal discipline and price stability, not headline market rallies, carry the weight. Mexico’s smaller-than-programmed deficit is a positive, but IMEF’s warning about rigid spending and pension costs shows how quickly that can erode. Peru’s inflation is above target, Brazil’s factories are contracting, and a strong dollar raises the cost of servicing foreign debt across the region. Mexico’s reliance on low-value-added exports and on the USMCA review leaves it exposed to decisions made outside its borders. Investors and governments will watch whether growth can come from private activity rather than temporary public spending like World Cup construction.