Economic Growth in Mexico
Mexico's GDP growth from 2013 to 2022 was moderate, constrained by structural challenges and policy uncertainties. The economy benefited from its proximity to the United States but faced headwinds from fluctuating oil prices and an ambivalent stance towards the private sector under the President Obrador. Post-pandemic the economy has benefitted from investment by firms looking to reshore production close to the vast U.S. market.
The Mexican economy recorded an average growth rate of 1.2% in the decade to 2022, below the 1.3% average for Latin America. In 2022, real GDP growth was 3.9%. For more GDP information, visit our dedicated page.
Mexico GDP Chart
Mexico GDP Data
2018 | 2019 | 2020 | 2021 | 2022 | |
---|---|---|---|---|---|
Economic Growth (GDP, ann. var. %) | 2.0 | -0.3 | -8.6 | 5.7 | 3.9 |
GDP (USD bn) | 1,257 | 1,306 | 1,120 | 1,312 | 1,464 |
GDP (MXN bn) | 24,177 | 25,143 | 24,082 | 26,619 | 29,453 |
Economic Growth (Nominal GDP, ann. var. %) | 7.3 | 4.0 | -4.2 | 10.5 | 10.6 |
Economy slows sharply in Q4
GDP expanded 0.1% on a seasonally adjusted quarter-on-quarter basis in Q4 according to a flash estimate (Q3: +1.1% s.a. qoq), undershooting market expectations of 0.4% and marking the weakest outturn since Q3 2021. On an annual basis, economic growth waned to 2.4%, compared to the previous period's 3.3% growth. Despite the disappointing Q4 data, the economy still recorded 3.2% annual growth over 2023 as a whole, which should have been well above the Latin American average.
Q1’s GDP reading reflected a sharp fall in primary-sector activity, stable industrial activity and a small uptick in services. More detailed data for individual subsectors will be released in February.
Looking to Q1 2024, economic activity growth should pick up from the surprisingly weak Q4 2023 showing. Over 2024 as a whole, Mexico should continue to outperform the Latin American average, albeit by a lesser degree than in 2023.
On the outlook, Itaú Unibanco analysts said: “We expect activity to continue to grow at an above trend growth of 2.8% [in 2024,] supported by an expansive fiscal stance. Benefits from nearshoring may also support activity this year.” Goldman Sachs’ Alberto Ramos said: “Going forward, real activity is likely to face headwinds from high interest rates, a positive labor and output gap (limited slack in the economy), policy and regulatory uncertainty in key sectors (e.g., oil & gas, electricity, mining) and moderating external demand. On the positive side, household spending is likely to continue to benefit from firm credit flows, robust labor market backdrop (including solid formal job creation and generous minimum wage increases), moderating inflation, and an expansionary budget. Furthermore, private investment is likely to benefit from near- friendly-shoring dynamics.”
How should you choose a forecaster if some are too optimistic while others are too pessimistic? FocusEconomics collects Mexican GDP projections for the next ten years from a panel of 52 analysts at the leading national, regional and global forecast institutions. These projections are then validated by our in-house team of economists and data analysts and averaged to provide one Consensus Forecast you can rely on for each indicator. By averaging all forecasts, upside and downside forecasting errors tend to cancel each other out, leading to the most reliable GDP forecast available for Mexican GDP.
Download one of our sample reports to visualize what a Consensus Forecast is and see our Mexican GDP projections.
Want to get access to the full dataset of Mexican GDP forecasts? Send an email to info@focus-economics.com.
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