Bank of Mexico Cuts 2026 Growth Forecast to 1.1%

Bank of Mexico Lowers 2026 Growth Forecast to 1.1%

The Bank of Mexico (Banxico) cut its 2026 economic growth forecast to 1.1% from a previous estimate of 1.6%, according to its quarterly report published on Wednesday. The bank attributed the downward revision primarily to a considerably weaker performance in the first quarter of the year.

Investment Expected to Remain Weak

While the bank expects the economy to continue expanding at a moderate pace, it warned that investment is likely to remain weak until at least the second half of 2026 due to ongoing uncertainty surrounding trade relations with the United States and the upcoming review of the USMCA agreement.

Inflation and 2027 Outlook

Banxico also slightly adjusted its 2027 growth outlook to 2.1%. Projections for average annual headline and core inflation for the fourth quarter of 2026 remained unchanged at 3.5% and 3.4%, respectively.