The market has again reduced its average growth expectation for Mexico’s Gross Domestic Product (GDP) and now anticipates it to rise by 0.3%, according to the results of Citi’s survey.
This marks the fourth consecutive quarterly reduction in the growth forecast, distancing itself from the initial 1% estimate at the beginning of the year.
The expectation is below the 0.6% predicted mid-March and far from the lower end of the federal government’s current and expected range of 1.5 to 2.3%.
In more detail, among the 32 strategists surveyed, four predict a decline in this year’s growth:
- XP: Forecasts -0.5% GDP contraction
- Deutsche Bank: Predicts -0.4%
- Finamex and Santander Mexico: Both anticipate 0.3% negative GDP growth for 2025.
For the first time, it is observed that the remaining participants—26 analysts—expect growth below 1% this year. Among them, Barclays stands out with the highest growth expectation at 0.7%.
The number of analysts predicting growth below 1% has multiplied from four in mid-January to 15 in mid-February.
In this instance, five analysts predicted zero GDP growth: Banamex (maintaining a zero forecast since February), Itau BBA, BNP Paribas, Bank of America, Masari Brokerage, and UBS.
More Changes in Inflation and Rates
According to Citi’s survey results, the median of experts anticipates inflation will end the year at 3.78%.
This forecast adjusts from the previous 3.80%, as predicted in their March mid-term survey.
The modification could incorporate the possibility that demand pressures on inflation are lower due to weakened economic growth.
The median of experts predicts that the rate will close this year at 8%, a prediction unchanged since the March mid-term survey.
These expectations range from the maximum of 8.25% anticipated by Bancoppel and GBM to the minimum of 6.25% expected in Natixis.
An 8% expectation would imply that analysts expect the Bank of Mexico to continue reducing its target rate by another 100 basis points throughout the year.
The median of surveyed analysts anticipates a new 50-basis-point cut in the scheduled May meeting, marking the third consecutive of this magnitude. However, only two predict a more moderate adjustment—25 basis points: Oxford Economics and Banca Mifel.
