Bank of Mexico slashes 2025 economic growth forecast to 0.3%

The Bank of Mexico (Banxico) has chopped its 2025 maturation forecast for the Mexican system from 0.6% to 0.3%, citing a 3rd 4th contraction arsenic the main crushed for its revised prediction.

The cardinal bank’s caller forecast is included successful its quarterly study for the July-September period. The bank’s forecast maturation scope is 0.1% to 0.5%, with 0.3% being the midpoint.

Banxico Governor Victoria Rodríguez Ceja presented the study connected Wednesday, 5 days aft the nationalist statistic bureau INEGI reported a 0.3% economical contraction successful the 3rd 4th of 2025 compared to the erstwhile three-month play and a 0.2% yearly decline.

“The contraction of economical enactment successful the 3rd 4th of the twelvemonth represented a weakness successful the Mexican system greater than antecedently anticipated,” she said.

“This leads to the GDP maturation forecast for 2025 arsenic a full being adjusted from 0.6% successful the erstwhile [quarterly] study to 0.3% successful the existent one, Rodríguez said.

The 0.3% maturation forecast for 2025 is somewhat little than the 0.4% yearly GDP enlargement recorded successful the archetypal 9 months of the year. The maturation complaint successful the archetypal 9 months of 2025 represented Mexico’s worst economical show for the play since 2020, erstwhile the COVID pandemic and associated restrictions caused a crisp contraction.

En el tercer trimestre de 2025, y con cifras desestacionalizadas, el Producto Interno Bruto #PIB registró las siguientes variaciones:
⬇️-0.3% trimestral
⬇️-0.2% anual

Por componente, las variaciones trimestrales fueron:
⬆️ 3.5% actividades primarias
⬇️-1.5% actividades… pic.twitter.com/r8q7bH266Y

— INEGI INFORMA (@INEGI_INFORMA) November 21, 2025

Rodríguez noted that the Mexican economy’s show this twelvemonth has been adversely affected by a deterioration of the secondary assemblage arsenic good arsenic planetary uncertainty owed to commercialized tensions. The secondary assemblage contracted 1.5% successful the archetypal 9 months of the year, portion the superior assemblage grew 2.9% and the tertiary assemblage expanded 1.2%.

Mexico’s export gross — chiefly derived from the shipment overseas of manufactured goods — has continued to turn this year, adjacent arsenic a scope of Mexican products look tariffs erstwhile entering the United States.

A rosier outlook for 2026   

Banxico predicts that the gait of maturation of the Mexican system volition importantly quicken successful 2026 compared to this year. The cardinal bank’s forecast for adjacent twelvemonth is 1.1% growth, unchanged from the prediction successful its 2nd 4th report.

Banxico is forecasting that the Mexican system volition turn 2% successful 2027.

Rodríguez noted that the cardinal slope is anticipating “a faster gait of expansion” beyond 2025.

“We are of people assuming that the USMCA volition stay successful place, that the commercialized narration with the United States and Canada volition proceed arsenic it is now,” she said.

Bank of Mexico main politician Victoria Rodríguez Ceja shared this year’s downgraded maturation forecast connected Wednesday, but said the outlook for 2026 remains much positive. (Galo Cañas Rodríguez/Cuartoscuro)

The three-way North American commercialized pact volition acquisition a ceremonial reappraisal process successful 2026, six years aft it superseded NAFTA.

Mexico hopes that it volition beryllium capable to negociate adjacent amended trading conditions with the United States, whose authorities this twelvemonth has imposed tariffs connected a scope of Mexican goods including steel, aluminum and dense and airy vehicles.

The decision of the USMCA reappraisal should make much economical certainty successful North America, including for companies that are considering investing successful Mexico.

A greater influx of overseas nonstop concern (FDI) successful Mexico arsenic a effect of a affirmative result of the reappraisal could assistance the Mexican system turn much than expected successful coming years. In the archetypal 9 months of 2025, FDI successful Mexico reached a grounds precocious of conscionable implicit US $40.9 billion.

In its quarterly report, Banxico cited a scope of risks for maturation of the Mexican system implicit the forecast horizon, including an “intensification” of uncertainty related to U.S. commercialized argumentation and lower-than-expected maturation of the U.S. economy.

Banxico’s forecasts for ostentation and occupation creation 

The Bank of Mexico predicts that Mexico’s yearly header ostentation complaint volition beryllium 3.5% astatine the extremity of the year, down somewhat from a 3.61% speechmaking successful the archetypal 2 weeks of November.

Banxico anticipates that ostentation volition mean successful 2026 to scope 3% successful the 3rd 4th of 2026, and stay astatine that level into 2027. The cardinal slope targets 3% inflation, but tolerates a 2-4% range. It has chopped involvement rates aft each of the past 11 monetary argumentation meetings of its board, reducing its cardinal complaint from 11.25% successful aboriginal 2024 to 7.25% currently.

With respect to ceremonial assemblage occupation growth, Banxico forecasts that betwixt 210,000 and 310,000 further positions volition person been added successful 2025 by the extremity of the year. That scope includes integer level workers, who this twelvemonth became eligible for ceremonial employment benefits acknowledgment to the commencement of a six-month aviator program.

The Bank of Mexico is forecasting that an further 260,000 to 460,000 ceremonial assemblage positions volition beryllium added adjacent year, and betwixt 400,000 and 600,000 successful 2027.

Mexico’s unemployment complaint was 2.9% successful the 3rd 4th of 2025, but 55.4% of each radical with jobs successful that play were employed successful the country’s immense informal sector.

With reports from El Economista, Reforma and El Financiero