Overview and Relevance
The Citi April Edition of Expectations Survey reveals that experts have, for the fifth consecutive time, reduced their growth forecast for Mexico’s economy in 2025. Originally predicting a growth rate of 0.3%, the consensus now stands at 0.2%. This downward revision indicates that some analysts anticipate either stagnant growth or even a 1% decline in Mexico’s economy for the current year.
Details of the Forecast
- 2025 Growth Range: The experts’ projected growth rate for Mexico in 2025 now ranges from -0.7% to 0.8%, with some analysts predicting no growth or even a near 1% contraction.
- 2026 Growth Projection: Despite the pessimistic outlook for 2025, experts maintain their growth forecast for Mexico’s GDP in 2026 at 1.5%.
Next Monetary Policy Announcement by Banco de México
Regarding the upcoming monetary policy announcement by Banco de México (scheduled for May 15), analysts continue to anticipate a 50 basis points (bp) reduction in the reference rate, bringing it down to 8.50%. Out of 36 participants in the survey:
- Consensus on Rate Cut: Thirty-four participants predicted a 50 bp cut in May, while two expected only a 25 bp reduction.
- Median Policy Rate: The median forecast for the policy rate at the end of 2025 was lowered to 7.75%, a decrease of 25 bps from the previous survey, with estimates ranging from 6.25% to 8.25%.
- 2026 Policy Rate Expectation: The median expectation for the policy rate at the end of 2026 remained unchanged at 7.00%.
Inflation Outlook
Inflation expectations for the current year and the following year have remained stable. The projections for general inflation at the end of 2025 stayed at 3.78%, while the subsidized component saw a slight increase to 3.80% from 3.76% in the previous survey.
- 2026 General Inflation: The median estimation for general inflation at the end of 2026 is 3.79%, up slightly from 3.78% in the last survey.
- 2026 Subsidized Inflation: The median estimation for subsidized inflation remained constant at 3.70%.
Exchange Rate Projections
The consensus projects that the US dollar will close 2025 at 20.93 Mexican pesos, three cents more than in the last survey, and 21.20 Mexican pesos for 2026, ten cents less than in the previous edition.
