Mexico’s Economy Defies Expectations in the First Quarter, But Faces Challenges Moving Forward

Mexico’s economy outperformed expectations in the first quarter of the year, with preliminary estimates from the national statistics agency INEGI showing a 0.2% growth in gross domestic product (GDP) on a quarter-on-quarter basis, slightly exceeding the predicted 0.0%. However, on a yearly basis, Mexico’s economy grew at a slower rate of 1.6%, below the expected 2.1% growth and lower than the previous quarter’s growth of 2.5%.

Andres Abadia, Chief Latin America Economist at Pantheon Macroeconomics, attributed this slowdown to several challenges including tighter financial conditions, difficult external conditions, and increased infrastructure spending. Despite this, Mexico’s economy has now grown for ten consecutive quarters. Abadia noted that while there is still growth momentum, it appears weaker compared to recent trends. The figures indicate that Mexico’s economic growth faced challenges in the first quarter but continued on a path of expansion.