Overview and Context
In July 2025, Mexican consumers remain cautious with their spending. The monthly decline of 0.3% in consumer expenditure on goods and services led to a decrease in the Monthly Indicator of Private Consumption (IMCP) after gains in June (+0.9%), according to the National Institute of Statistics and Geography (Inegi).
This decline also resulted in a 0.1% interannual drop, marking the fifth consecutive decrease in the first seven months of 2025. The slowdown comes after three years of steady growth, fueled by consistent real wage increases.
Monthly and Interannual Analysis
- Monthly Decline: The 0.3% monthly drop is attributed to the decrease in domestic goods and services consumption, which fell 0.5%. This includes a 0.7% drop in goods and a 0.3% decrease in services.
- Import-based Consumption: In contrast, consumption of imported goods increased by 1.7% for three consecutive months, though this growth was lower than the 5% increase in the previous month.
- Comparison to Previous Estimate: The 0.3% monthly decline is less severe than the 0.7% estimated by Inegi mid-September through its Opportune Private Consumption Indicator (IOCP).
Year-to-Date Comparison and Challenges
From January to July, private consumption has decreased by 0.4%, contrasting with the 4.3% growth observed in the same period of 2024.
- Import-based Goods: The most significant burden is the 3.7% decline in import-based goods consumption, which aligns with the interannual depreciation of the Mexican peso against the US dollar and increased import tariffs.
- Domestic Goods and Services: Domestic goods consumption has slightly contracted by 0.3%, while service acquisitions have risen by 1.3%.
Key Questions and Answers
- Q: What is the main issue affecting private consumption in Mexico? A: The primary challenge is the decrease in import-based goods consumption, which has fallen 3.7%. This decline coincides with the Mexican peso’s interannual depreciation against the US dollar and increased import tariffs.
- Q: How has private consumption performed compared to previous years? A: Private consumption has decreased by 0.4% from January to July 2025, contrasting with the 4.3% growth observed in the same period of 2024.
- Q: What factors have contributed to the recent slowdown in private consumption? A: The slowdown is attributed to caution among consumers amidst uncertainty over the US trade policy changes, a decline in formal employment generation, and a slowdown in remittances.
