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Investing.com -- Mexico’s government has adjusted its economic growth forecast for 2025 to a range of 1.5% to 2.3%, down from a previous estimate of 2.0% to 3.0%, as revealed by a draft budget from the country’s finance ministry on Tuesday.
Despite the downward revision, the finance ministry’s forecast remains more optimistic than those of the private sector and Mexico’s central bank.
The ministry has described its growth forecast as conservative, even as Mexico faces potential recession concerns. The country’s economy, ranked second in Latin America, has been rattled by waning investor confidence, threats of U.S. tariffs, and a long-lasting drought.
The economy contracted in the last quarter and again in January. If a contraction occurs in the first quarter, it would push Mexico into a technical recession.
The finance ministry’s statement on Tuesday attributed the lower 2025 growth forecast to a weakened residential investment environment and supply shocks that have been ongoing since the end of last year. The ministry also pointed out that business caution, spurred by uncertainty over U.S. trade policy, is another contributing factor.
In contrast to the finance ministry’s outlook, the autonomous Bank of Mexico had predicted in February that the economy in 2025 could either contract by as much as 0.2% or expand by up to 1.4%. Additionally, private sector analysts surveyed by Mexico’s central bank on Tuesday have further lowered their average growth forecast for the year to a mere 0.5%.
Looking further into the future, the finance ministry anticipates economic growth of between 1.5% and 2.5% in 2026.
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