Moody’s Cuts Mexico Growth Forecast to 0.6% Amid Trade Tensions

Mexico’s economic outlook for 2025 is dimming, with Moody’s Analytics forecasting a one percentage point reduction in GDP growth. This downturn stems from U.S. trade policies and Mexico’s internal fiscal adjustments.

Alfredo Coutiño, Moody’s Latin America director, maintains a 0.6% growth forecast for Mexico. He points out Mexico’s vulnerability to U.S. trade and immigration policy changes.

The implementation of tariffs is expected to impact Mexico’s trade and nearshoring prospects significantly. Citi’s market survey offers a slightly more optimistic view, projecting 1% growth for Mexico in 2025.

This figure aligns with Banco de México‘s growth interval of 0.4% to 2%. However, individual forecasts vary widely, ranging from 0.2% to 1.8% growth.

The survey also revised 2024 growth estimates downward to 1.5%, below the government’s 2-3% projection. This figure falls short of forecasts by international organizations like the World Bank and IMF.

Moody’s Cuts Mexico Growth Forecast to 0.6% Amid Trade Tensions. (Photo Internet reproduction)

On the inflation front, Citi’s survey anticipates a 0.27% increase in January. Year-end inflation is expected to reach 3.91%, falling within Banco de México’s target range for the first time.

As Mexico navigates these economic challenges, its ability to adapt to changing trade dynamics and maintain investor confidence will be crucial. The interplay of external pressures and domestic policies will shape the country’s growth trajectory in the coming years.