Private analysts raise growth forecast for Mexico to 2.7% for 2023

Private sector analysts have increased their growth forecast for Mexico’s GDP in 2023 to 2.7%, according to a recent Citibanamex Expectations Survey.

Projections from these analysts range from a high of 3.5% to a low of 2.1%. For 2024, a compilation of insights from 33 different financial groups predicts a 1.5% growth.

Mexico’s government expects a GDP growth of over 3% in 2023, attributing it to the relocation of supply chains to the country, a trend called “nearshoring”.

The Citibanamex survey indicates a consensus among experts that the Bank of Mexico will make a 25 basis point interest rate cut by December 2023.

The general annual inflation expectation for 2023 has been slightly adjusted to 4.68%, while core inflation, which excludes highly volatile products like energy, has been revised to 5.15%.

For 2024, inflation forecasts remain unchanged at 4%, which is above the Bank of Mexico’s 3% target.

The survey also suggests a stronger exchange rate with a consensus of 17.88 pesos per dollar by the end of 2023, improving from a prior 17.95.

The 2024 forecast predicts the Mexican currency to close at 19 pesos per dollar.

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