DistantNews
Support us
BBVA cuts Mexico's 2026 growth forecast to 1.2% on lower investment
🇵🇾 Paraguay /Economy & Trade

BBVA cuts Mexico's 2026 growth forecast to 1.2% on lower investment

From ABC Color · () Spanish

Translated from Spanish, summarized and contextualized by DistantNews.

At a glance

News From a news agency New plan
  • BBVA has lowered its 2026 growth forecast for Mexico to 1.2% from 1.8% due to slowing investment and consumption.
  • The bank cited weaker domestic demand, with moderating consumption and contracting investment, despite resilient external demand from the U.S.
  • BBVA anticipates a gradual economic recovery in 2027, driven by reduced trade uncertainty and public-private partnerships, while noting inflation is behaving well.

BBVA Research Mexico has revised down its 2026 economic growth forecast for the country to 1.2% of GDP, a significant decrease from its previous 1.8% projection. The bank attributes this slowdown primarily to a deceleration in investment and consumption, coupled with diminished dynamism in domestic demand amidst prevailing uncertainty.

the North American nation is growing "at three speeds" internally and externally.

— Saidé SalazarBBVA Research Mexico's chief economist explaining the country's economic performance.

According to BBVA Research Mexico's chief economist, Saide Salazar, Mexico's economy is exhibiting growth "at three speeds." While external demand for Mexican goods and inputs from the United States has remained "relatively resilient," bolstering exports, the internal economic landscape shows "less dynamism." Salazar specifically pointed to moderating consumption and a notable contraction in gross fixed investment as key concerns for the latter half of the year.

external demand for goods or inputs from the United States has remained "relatively resilient" this year and boosted Mexican exports, while internal demand showed "less dynamism" with low growth in investment or consumption.

— Saidé SalazarThe economist detailing the contrasting performance of Mexico's external and internal demand.

Despite the downward revision for 2026, Salazar expressed optimism for a "gradual recovery" in the following year. This outlook is supported by expectations of "less trade uncertainty" and the advancement of mixed contracts between the public and private sectors. The economic boost from the 2026 FIFA World Cup, co-hosted by Mexico, is expected to be "transitory" during the current period.

The underlying weakness of domestic demand will persist into the second half of the year (...) We are practically observing moderation in consumption and a significant contraction in gross fixed investment.

— Saidé SalazarThe economist elaborating on the persistent issues within Mexico's domestic economy.

Carlos Serrano, BBVA Mexico's head economist, added that inflation, recorded at 3.94% in May, has been "behaving quite well" for several months. He also expressed confidence that the Bank of Mexico has concluded its interest rate reduction cycle. On the international front, Serrano anticipates that energy markets will take approximately two months to stabilize despite a recent peace agreement between the U.S. and Iran, forecasting "high" oil prices for several more weeks.

gradual recovery" of the economy, thanks to "less trade uncertainty and the advancement of mixed contracts" between the public and private sector.

— Saidé SalazarThe economist outlining the factors expected to drive economic recovery in the following year.
DistantNews Editorial

Originally published by ABC Color in Spanish. Translated, summarized, and contextualized by our editorial team with added local perspective. Read our editorial standards.

More Stories

From Our Blog