By THE NEW YORK TIMES

MEXICO CITY, May 15 — Mexico's gross domestic product grew 2.3 percent in the first quarter of the year over the same period in 2002, the Finance
Ministry said today. But on a seasonally adjusted basis, the economy contracted 0.49 percent compared with the previous quarter.

The lackluster figure was lower than the 2.7 percent the ministry had forecast earlier and will make it difficult for the country to reach its forecast of 3 percent for the
full year. The central bank has already downgraded its forecast to 2.4 percent, and many private analysts have similar expectations.

The economy has been in the doldrums for two years, a casualty of the slowdown in the United States, which has dampened demand for Mexican exports.