Mexico’s Economy Ends 2025 With A Small Uptick, But Growth Stays Soft

Key Points

• An early INEGI reading suggests 0.2% growth in December, driven by services
• The estimate is preliminary and could change with the IGAE and GDP releases in late January
• Downgraded forecasts are sharpening questions about rates, budgets, and investor confidence

Mexico likely ended 2025 with a modest December rebound, but not enough to change the cooling story. INEGI’s Indicator of Timely Economic Activity, a fast “nowcast,” estimates the economy expanded 0.2% in December versus November.

That is slightly better than the 0.1% estimate for November. The breakdown matters. Services are estimated to have grown 0.2% in the month.

Industry rose 0.1%. On an annual basis, the nowcast points to 2.3% growth in December. Services are put near 2.9% year on year. Industry is closer to 1.2%.

December’s small gain also stands out against recent year-end swings. In December 2023, the economy grew 0.4% month to month. In December 2024, it contracted 0.9%. By that yardstick, the 2025 finish looks stable rather than strong.

Still, this is not final data. The IOAE is designed for speed and carries wide uncertainty bands. INEGI’s fuller monthly activity gauge, the IGAE, can revise the picture.

Growth outlook keeps policy risk high

The next IGAE release is scheduled for January 23. An early GDP estimate is due January 30. Those two releases should clarify whether late-2025 momentum was real.

What makes the new estimate politically sensitive is the direction of expectations. Mexico’s federal government started 2025 projecting growth between 1.5% and 2.3%.

In the 2026 budget package, that range was cut to 0.5% to 1.5%. Private forecasts moved too. A recent Citi expectations survey centered on 0.4% growth for 2025. Multiva penciled in 0.6%. Scotiabank projected zero.

For households and firms, a soft landing shows up through hiring, credit, and demand. For the central bank, weaker growth can widen the case for rate cuts.

But it also narrows room for policy mistakes. For investors, the message is simple. When growth is scarce, predictable rules and disciplined public finances matter more.

Related coverage: Brazil’s Morning Call | Dollar Softness Kept The Peso Firm As Mexico Stocks Hovered This is part of The Rio Times’ daily coverage of Mexico affairs and Latin American financial news.

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