The Organization for Economic Cooperation and Development (OECD) improved its forecasts on the Mexican economy for this year by estimating that it will not contract.
In March the agency predicted that GDP would fall 1.3% due to the uncertainty generated by Trump’s tariffs, but now anticipates an advance of 0.4%.
It also considerably improved its estimate by 2026, since in March it calculated that the Mexican economy would fall 0.6% and in its June update an expansion of 1.1% awaits.
Even with the improvement for this year, Mexico will register the least economic growth in Latin America.
In its report “Economic Perspectives” of the second quarter, the OECD warned that the effects of the new commercial barriers imposed by the United States and a low internal dynamism will limit the recovery of the country.
Lee: OECD anticipates falls from the Mexican economy in 2025 and 2026 for tariffs
The low growth is explained, in part, by external factors such as recent tariff policies of the United States that are affecting the competitiveness of Mexican exports and relegating investments.
“Given Mexico’s high exposure to the US market, the deceleration projected in the US for 2025-26 and the most restrictive financial conditions could further ballast external and investment demand,” said the document.
The OECD recalled that the Mexican economy is particularly exposed to external risks, since more than 75% of exports depend on the US market.
“The hardening of the rules of origin of the TMEC and the recent US protectionist measures have raised export costs for key products such as cars, auto parts, machinery and appliances,” he added.
Internal, the OECD pointed to a slowdown in the consumption and investment of the public sector, “given a continuous fiscal consolidation”, so it suggested a medium -term fiscal plan that could help reduce the deficit that the government intends to reduce from almost 6 to 3% in this year.
The OECD also stressed that low unemployment and inflation reduction will boost consumption, while the Central Bank must continue with its prudent and gradual flexibility cycle to ensure its 3% objective for the indicator.
With EFE information
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