IMF cuts Mexico's GDP forecast to 1.2% amid prevailing uncertainty

The International Monetary Fund (IMF) has revised down its economic growth projections for Mexico, citing persistent uncertainty as a key factor hindering the country's progress. In its latest World Economic Outlook report, the IMF lowered its Gross Domestic Product (GDP) growth estimate for Mexico for both 2024 and 2025.

For the current year, the forecast has been adjusted to 1.2%, a decrease of 0.4 percentage points from the 1.6% predicted in April. Looking ahead to 2025, the IMF now anticipates a growth rate of 1.9%, down from the previous estimate of 2.2%. This marks the first time this year that the international financial institution has reduced its expectations for Mexico's economic performance.

The IMF's assessment is set against a backdrop of global economic challenges. The report highlights concerns over accelerating trade fragmentation, which could negatively impact production and increase prices. Additionally, the risk of renewed conflict in the Middle East and a stagnation in disinflationary trends are identified as significant threats to global economic stability.

Despite these headwinds, the IMF projects a moderate acceleration in Mexico's growth, partly attributed to less restrictive domestic policies. However, the institution cautioned that ongoing uncertainty will continue to limit economic activity. The report also provides a broader outlook for Latin America and the Caribbean, forecasting stable growth for the region, though with varied dynamics among individual countries.