Mexico’s March 0.4% Economic Dip Raises Growth Concerns

Mexico’s economic activity contracted by 0.4% in March, raising concerns about the country’s short-term growth prospects, according to the National Institute of Statistics and Geography (INEGI).

The Global Indicator of Economic Activity (IGAE) recorded a monthly decline of 0.4%, marking the first quarterly drop since December 2023. On an annual basis, economic activity fell by 0.1%, the first year-over-year contraction since December 2023, when it declined by 0.7%.

By sector, primary activities saw the strongest performance, growing 4.3% month-over-month. This category, which includes agriculture, livestock, fishing, and hunting, has now expanded for four consecutive months. The March growth is the highest since July 2023, when the sector rose by 13.5%.

Secondary activities, encompassing industrial production, contracted by 0.9%, the sharpest decline since December 2023. Within this sector, mining dropped by 2.7%, while construction was the only sub-sector to post growth, with a 0.8% increase.

Tertiary activities, which include services, decreased by 0.4%, marking their first decline since December 2024. Professional, scientific, and technical services saw the steepest drop within this segment, falling 5.2% compared to February.

Despite the March downturn, Mexico’s gross domestic product (GDP) is estimated to have grown 0.2% in the first quarter of 2025, avoiding a technical recession.

The Ministry of Finance and Public Credit (SHCP) has maintained its 2025 growth forecast at 1.5%–2.3%, stating that a recession is not anticipated but acknowledging a more challenging economic outlook.

Meanwhile, the International Monetary Fund projects a 0.3% contraction for Mexico’s economy in 2025, and the World Bank forecasts zero growth, attributing risks to external factors such as US trade policies.