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# Annex Ct Ouarterly and Monthly Private Consumption Series

In this annex we describe the sources of quarterly and monthly consumption series as well as the approach followed to identify some of their components. We also assess potential discrepancies by frequeacy of data. The Bank of Mexico provides quarterly indices of GDP and demand components on a regular basis. When those indices are applied to the 1980 figures of the national accounts we obtain quarterly demand components expressed in 1980 pesos. Although the quarterly GDP obtained in this way is not the official quarterly GDP (which is provided regularly by INEGI), the demand components of GDP computed by Banco de Mexico are the only available so far.

The total quarterly private consumption index published by the Bank of Mexico is actually computed (but not published) at a fairly disaggregated level. The disaggregation is provided in Table C.l. As shown in the table, the series comprises domestically produced private consumption, imported private consumption and a small item called net foreign purchases which correct for cross border net consumption (foreigners in Mexico and Mexicans abroad), normally associated with frontier transactions not correctly detected when computing the two mayor items. Domestically produced private goods are also disaggregated into agriculture consumption, industrial consumption (durables and non-durable, there the latter is further disaggregated into food and non-food), and services. The imported private consumption series is not disaggregated further by the Bank of Mexico. Nevertheless, we have been able to separate durable and non-durable private imports by applying the share of durable imports in total consumption imports (both expressed in US dollars) to the imported consumption series in 1980 pesos. The share of durable imports in dollars is a good proxy for the share of real imported durable consumption if the relative prices in dollars have not change significantly over the period (something which is not very likely). Table C.2 provides the series of dollar imports of private consumers employed to break down the imported consumption series in Table C.1. The share of quarterly durable imports (adding the months) over total quarterly imports, is used to separate durable and non-durable imported consumption. Table C.3 provides the quarterly series of durable, non durable and services.

# Comparison of Ouarterlv and Annual Series.

Here we compare of quarterly and annual consumption series. As mentioned in Annex A, quarterly information is likely to be more inaccurate than annual information. In order to evaluate possible mismeasuremenz errors at the quarterly level, we compare the annual (official) series from INEGI with the quarterly series by the Banco de Mexico. Table C.4 provides this information for the period 1980-90. We can see that in general the quarterly information does not deviate much from the official series. Although some underestimation of the consumption series is apparent in the last four years, which at most represents 3% of annual consumption in 1990. Conseauentlv the auarterly series of consumption from the Bank of Mexico can be used with hiah confidence.

# Comoarison of Monthly and Quarterly Consumption Series.

Although the Bank of Mexico does not produce a monthly version of its quarterly index, most of the basic information used to compute the quarterly series is available on a monthly basis. Officials in the Bank of Mexico kindly responded positively to our request for the monthly data and provided the series for consumption of domestically produced goods shown in Table C.5. To complete the series we have computed a series of imported consumption in 1980 pesos by deflating the dollar series in Table C.2 by a dollar price index of private imported goods. To separate durable and non-durable consumption we