Mexico Shows Modest 0.2% December Growth, INEGI Indicator Says

Mexico’s economy is estimated to have expanded by 0.2% month-on-month in December 2025, slightly accelerating from the prior month, according to the Timely Indicator of Economic Activity (IOAE). The report, published by the National Institute of Statistics and Geography (INEGI), indicates that the marginal monthly increase follows an estimated 0.1% expansion in November.

The December performance represents the strongest year-end reading since 2023, when the economy expanded 0.4%. In contrast, December 2024 recorded a 0.9% contraction. Recent growth was primarily underpinned by the tertiary sector, encompassing services, which posted a 0.2% monthly increase. Secondary activities, including industrial sectors, expanded by 0.1%, reflecting modest momentum in manufacturing and construction.

Annual Performance and GDP Projections

Based on these monthly indicators, the Mexican economy achieved an annual growth rate of 2.3% in December. Gabriela Siller, Director of Economic and Financial Analysis, Banco Base, noted that if the preliminary data is confirmed, gross domestic product (GDP) for 4Q25 would show a quarter-on-quarter increase of 0.97% and an annual expansion of 1.36%.

Under this scenario, full-year GDP growth for 2025 is estimated at 0.65%. This outcome is consistent with a broader deceleration observed throughout the year, which prompted successive downward revisions to growth expectations from both private-sector analysts and federal authorities.

Fiscal Adjustments and Market Consensus

The cooling economy led the Ministry of Finance and Public Credit (SHCP) to revise its 2025 growth forecast downward. Initially projected in a range of 1.5% to 2.3%, the estimate was lowered in the 2026 Economic Package to 0.5%–1.5%.

External analysts maintain a more cautious outlook. The latest Citi Expectations Survey shows an average growth forecast of 0.4% for 2025, with projections varying across institutions:

• Multiva: 0.6%

• Banco Base: 0.65% (estimate)

• Scotiabank: 0.0%

Looking ahead, the International Monetary Fund (IMF) and the Organisation for Economic Co-operation and Development (OECD) have maintained their 2026 GDP growth forecasts for Mexico at 1.5% and 1.2%, respectively, while the local consensus points to an average of 1.3%.

The IOAE provides an early econometric estimate and is subject to revision. The Global Indicator of Economic Activity (IGAE), which offers more comprehensive and definitive data, is scheduled for publication on Jan. 23, 2026. INEGI will also release the timely estimate of full-year 2025 GDP on Jan. 30, 2026.

IMF’s Growth Projection

The IMF has recently upgraded its global growth outlook for 2026 to 3.3%, from 3.1% previously, citing a global economy that has proven more resilient than expected. The revision reflects a surge in artificial intelligence-related investment and broader technological spending. However, the IMF cautions that this optimism is tempered by risks, including renewed trade tensions and uncertainty over the pace at which AI-driven productivity gains will materialize.

For Mexico, the 2026 growth forecast remains unchanged at 1.5%. While this positions the country as the second-largest growth contributor in Latin America, slightly behind Brazil’s projected 1.6%, Mexico is expected to underperform the regional average of 2.2%. Independent forecasts are more conservative, with Goldman Sachs projecting 1.3% growth and Mexico's Central Bank (Banxico) forecasting 1.1%.