Consumer Confidence in 2025 Hits Largest Annual Drop Since 2020

Mexican consumer confidence concluded 2025 with its most significant annual retreat since the COVID-19 pandemic, signaling deep-seated caution among households despite a marginal month-over-month recovery in December. According to data released by INEGI, the Consumer Confidence Indicator (ICC) closed the year at 44.7 points, based on seasonally adjusted figures.

INEGI’s ENCO report is designed to provide statistical data on citizen satisfaction regarding their economic situation, their families' welfare, and the country's overall trajectory. The indicator serves as a benchmark for social well-being, development, and economic variables over time.

While the December result represented a monthly advance of 0.6 points, breaking a three-month streak of consecutive declines, the annual comparison revealed a 2.4-point drop from December 2024. This marks the first annual decline for a year-end since 2022 and the largest December retreat since 2020, when the pandemic caused the indicator to plunge 4.9 points.

Analysts from MONEX noted the volatility of the past 12 months in their year-end report. “Consumer confidence closes 2025 with ups and downs throughout the year. While a slight improvement in families' economic perception was observed in December, the indicator remains below levels recorded last year, in an environment characterized by high caution,” the firm highlighted.

The December monthly increase of 0.6 units was primarily driven by a 1.5-unit improvement in the perception of the country's economic situation compared to 12 months ago. Expectations for the country's future also advanced by 0.8 units compared to November. Despite these short-term gains, the annual trend shows 12 consecutive months of negative year-over-year results. 

Structural Deterioration in National Outlook

The data, compiled jointly by INEGI and Banxico, showed that four of the five main components of the ICC reported annual declines. The most severe deterioration occurred in the perception of the country’s future. Expectations regarding the national economic situation one year from now fell 6.9 points compared to December 2024. Similarly, the perception of the country’s current economic situation compared to 12 months ago decreased by 4.3 points. MONEX analysts emphasized the weight of these figures: “In their annual comparison, both indicators present a notable deterioration, which reflects low optimism in the country's economic conditions compared to the same month of 2024.”

This sentiment developed during a year when the Mexican economy faced uncertainty related to foreign policy changes, impacting overall performance. Current government projections place Gross Domestic Product (GDP) growth for the year between 0.5% and 1.5%, a figure lower than initial market expectations. Compared to Latin America and the Caribbean, which was expected to reach 2.4% in 2025, Mexico’s projection was just 0.4%, where trade uncertainty and domestic headwinds continue to weigh on activity.

“This slowdown is mainly explained by a sharp decline in consumption and investment, as well as uncertainty surrounding access to the United States market, which has negatively affected investment announcements and their execution,” said José Manuel Salazar-Xirinachs, Executive Secretary, ECLAC. “Despite the Mexican government’s effective negotiation efforts, the level of uncertainty has been significant for an economy that is highly integrated and exports more than 80% of its goods to the United States.”

At the end of 2025, the Institute of International Finance (IIF) also reported that Mexico’s economy is projected to grow 0.9% in 2026, marking a second consecutive year of sub-1% expansion. This forecast remains below the pre-pandemic average of 1.8% and contrasts with the 2.3% growth estimate used by the Mexican government for its federal budget.

The outlook for the household's future situation in one year fell 1.2 points annually, while the current household situation retreated by a marginal 0.1 points. In contrast to the negative national outlook, the component measuring the possibility of purchasing furniture and home appliances was the only primary category to show annual growth, rising 0.2 points. This specific optimism in durable goods coincided with a period of moderating inflation. In the first half of December, annual consumer inflation decelerated to 3.72%, down from a previous 3.99%. Monthly data further supported this trend, with possible appliances purchase possibilities rising 0.2 points in December, influenced by holiday festivities and seasonal discount cycles.

“In general terms, a pessimistic sentiment persists among households, with an accentuated deterioration in evaluations of the country's economic situation, both in its current and future components. In contrast, the perception of household finances showed greater resistance, although without reversing the fragility observed in the purchasing possibilities of families,” MONEX added.