Mexico's ongoing support for state oil company Petroleos Mexicanos (Pemex) remains a challenge to government finances and the sovereign credit rating, Moody's said on Thursday.
Moody's, which gave Mexico a "Baa1" rating with a negative outlook, said "sluggish domestic demand, weak investment prospects and limited productivity growth" weigh down the Latin American country's medium-term growth prospects.
The rating agency said that Mexico's economic activity will moderate in the coming years after rebounding in 2021 and that higher inflation and a more restrictive monetary policy will affect the country's credit profile.
(Reuters - Reporting by Diego Ore and Valentine Hilaire; Writing by Kylie Madry; Editing by David Alire Garcia and Sandra Maler)
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