a worker walks past storage silos at the alipec animal feed factory where a mix of imported and nationallyproduced corn is used to make feed for cows pigs and chickens on the outskirts of guadalajara mexico march 11 2021 reutersfernando carranza mexico city july 29 reuters  mexicos manufacturing sector declined in july with demand for the countrys goods hit by inflation after a long pandemicdriven downturn a survey showed on friday despite hopes for a recovery the seasonally adjusted sp global mexico manufacturing purchasing managers index pmi mxpmimeci fell to 485 in july from 522 in june aside from a brief hiatus in may and june mexicos pmi has lingered below the 50point threshold that separates growth from contraction since march 2020 it hit a record low of 350 in april 2020 during the initial enactment of the countrys covid19 containment measures the data showed a july drop in factory orders and lower sales with pressure from drought input shortages and inflation the drop in manufacturing output also prompted a marginal drop in employment for the first time in four months companies are now reporting trepidation over their financials a factor which restricted input buying and led to the nonrenewal of temporary contracts said pollyanna de lima economics associate director at sp global market intelligence business confidence also dropped with almost onequarter of those polled predicting output levels would continue to fall in the coming 12 months de lima added solvency concerns alongside supplychain constraints the war in ukraine and acute price pressures stifled business confidence in july mexicos central bank announced a record interest rate increase last month if an effort to control inflation with more hikes expected reporting by isabel woodford editing by david alire garcia and william mallard