Mexico Economic Activity Rebounds 0.2% in June, INEGI Reports

Mexico’s economic activity is projected to have grown 0.2% month-over-month in June following a 0.3% contraction in May, according to preliminary estimates from INEGI. Despite modest monthly gains in industrial and service sectors, persistent weakness in private investment and trade-related uncertainties have led financial institutions and the Bank of Mexico to converge full-year GDP growth forecasts near 1.1%. The low-growth environment directly affects industrial manufacturing, construction, and commercial enterprises operating across the domestic market.

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Mexico’s economy is estimated to have expanded 0.2% month-over-month in June, according to the National Institute of Statistics and Geography (INEGI). As part of its estimate, INEGI also revised its data for May, revealing a 0.3% contraction in economic activity.

On an annual basis, INEGI’s Timely Indicator of Economic Activity (IOAE) projects a 1.6% expansion for June, marking an acceleration compared with the 1.1% annual growth estimated for May. The preliminary results indicate a slight stabilization in national output, driven by simultaneous 0.2% monthly gains in both industrial and service sectors following volatile performance across 2Q26.

The monthly IOAE estimate provides an early directional projection of the Global Indicator of Economic Activity (IGAE), the primary monthly benchmark tracking real economic performance across productive sectors in Mexico, excluding the primary or agricultural sector. In June, secondary activities (manufacturing, construction, mining, and utilities) and tertiary activities (services, commercial distribution, and retail trade) both registered estimated monthly increases of 0.2% on a seasonally adjusted basis. When compared with June 2025 data, secondary activities are projected to grow 0.5%, while tertiary activities are forecast to expand 2.2%. 

The estimated monthly expansion in June follows a downward adjustment for May, in which economic activity contracted by 0.3% month-over-month. INEGI’s revised May figure represents a weaker outcome than the flat 0.0% growth originally anticipated in the institute's previous estimate. Earlier in the quarter, observed IGAE data for April recorded a 1.2% monthly expansion and a 2.2% year-over-year increase. INEGI is scheduled to publish observed IGAE data for May on Thursday, with final June figures set for release on August 24.

Broader Economic Deceleration

The short-term monthly fluctuations captured by the IOAE occur against a broader trajectory of decelerating economic growth across Mexico. While individual months reflect minor operational rebounds, private sector analysts and monetary authorities have repeatedly trimmed full-year economic projections, pointing to lingering weakness in private investment and domestic demand.

In late May 2026, Mexico’s central bank (Banxico) lowered its real GDP growth forecast to 1.1% from 1.6% following a 0.6% contraction during 1Q26. Bank of Mexico Governor Victoria Rodríguez acknowledged that economic weakness has broadened across both manufacturing and service sectors. Central bank assessments indicate that while private consumption has provided baseline support, private capital expenditure remains subdued amid ongoing trade policy uncertainties and the ongoing United States-Mexico-Canada Agreement (USMCA) review process.

Financial institutions have similarly aligned their projections with the lower growth environment. In June, BBVA Research revised its GDP growth forecast for Mexico downward to 1.2% from a previous estimate of 1.8%. Saidé Salazar, Principal Economist at BBVA Research Mexico, stated that domestic investment and consumption have experienced a notable deceleration, even as resilient external demand for Mexican manufactured goods from the United States offers a partial buffer for export industries.

The same month, the Organisation for Economic Co-operation and Development (OECD) downgraded its 2026 economic growth projection for Mexico to 0.8%, down from the 1.3% forecast published in March 2026. The organization attributed the revision to decelerating domestic demand, ongoing trade policy uncertainty with the United States, and fiscal consolidation measures intended to reduce the federal deficit below 4% of GDP.