Introduction to the Encuesta de Expectativas Citi México
The latest Encuesta de Expectativas Citi México presents a stable outlook with gradual improvement signals for the national economy.
Steady Economic Growth Projections
According to the 39 participants in the survey, the consensus maintains the expectation of a GDP growth rate of 0.5% for 2025 and 1.3% for 2026, with no changes compared to the previous year. This could reflect confidence in a sustained, though moderate, recovery.
Range of Estimations
The range of estimations spans from a slight contraction of -0.1% (Scotiabank and Valmex) to an expansion of 1 percent (BX+). This suggests a cautious consensus, yet with an upward trend in economic activity expectations.
Monetary Policy and Interest Rates
The consensus of participants anticipates that the Banco de México will reduce its reference rate by 25 basis points in the November meeting, keeping the median of forecasts at 7% for the end of 2025.
For 2026, the prediction of a decline to 6.5% remains, with estimates ranging between 6 and 7%. This indicates a move towards less restrictive monetary policy due to the decrease in inflationary pressures.
Exchange Rate Expectations
Regarding the exchange rate, expectations have been adjusted downwards. The survey suggests that the Mexican peso will strengthen to 19.00 units per dollar by the end of 2025, compared to the previously expected 19.26 pesos, and will be at 19.50 in 2026, down from 19.87 in the previous survey.
This improvement may indicate a sustained positive market perception of the national currency, backed by inflation control and stable interest rates.
Inflation Outlook
Inflation, Less Pressured
In terms of prices, the consensus projects a general annual inflation rate of 3.79% in September and an underlying rate of 4.28%. Both are slightly higher than in August.
By the end of 2025, general inflation is estimated at 3.96% annually, a decrease from 3.99% in the previous survey, and underlying inflation at 4.20% annually, an increase from 4.12% in the previous survey.
For 2026, general inflation is expected at 3.80%, and underlying inflation at 3.78%.
In the long term, from 2027 to 2031, the average annual inflation rate expectation remains at 3.70%, suggesting that analysts trust the convergence of prices towards the central bank’s target.
Key Questions and Answers
- What are the economic growth projections for Mexico? The consensus maintains a GDP growth rate of 0.5% for 2025 and 1.3% for 2026, indicating a moderate recovery.
- How do expectations for monetary policy look? Participants anticipate a 25 basis points reduction in the reference rate by Banco de México in November, with a median forecast of 7% for the end of 2025.
- What are the exchange rate expectations? The peso is expected to strengthen, reaching 19.00 units per dollar by the end of 2025 and 19.50 in 2026.
- What is the outlook for inflation in Mexico? General annual inflation is projected at 3.79% in September, 3.96% by the end of 2025, and 3.80% in 2026. Underlying inflation is expected at 4.28% annually, decreasing to 4.20% by the end of 2025 and 3.78% in 2026.
