Mexico Economic Forecast

Mexico Economic Outlook

May 19, 2020

Preliminary data revealed that the economy shrank for the fourth successive quarter and at the steepest rate since the 2009 global financial crisis in Q1, as the Covid-19 pandemic started to take its toll. A still-reeling industrial sector and a sharp pullback in services activity led the downturn. It will be in Q2, however, that the full brunt of the coronavirus shock will be felt. Output in the automotive sector, which forms the backbone of the country’s manufacturing industry, collapsed by 99% in April as plants shut down operations. Moreover, business closures and evaporated demand led both the manufacturing and services PMI to plunge to historic lows in the same month while a record number of formal jobs were lost from March. Meanwhile, on 13 May, authorities announced the gradual lifting of restrictions to get the economy back online, with the crucial auto industry among the first to restart operations.

Mexico Economic Growth

The economy is set to suffer a deep recession this year. Social distancing measures are set to hammer household spending; investment will be derailed amid elevated uncertainty; and exports will crumble as the pandemic ravages global demand. The shaky finances of debt-saddled Pemex and economic difficulties in the U.S. are major risks ahead. FocusEconomics panelists project the economy to contract 7.1% in 2020, which is down 2.0 percentage points from last month’s forecast, and grow 2.6% in 2021.

Mexico Economy Data

2015 2016 2017 2018 2019
Population (million)121122124125126
GDP per capita (USD)9,6658,8099,3899,8059,999
GDP (USD bn)1,1691,0771,1601,2231,259
Economic Growth (GDP, annual variation in %)
Domestic Demand (annual variation in %)
Consumption (annual variation in %)
Investment (annual variation in %)5.01.0-1.60.9-4.9
Industrial Production (annual variation in %)1.10.3-0.30.5-1.7
Retail Sales (annual variation in %)5.05.3-
Unemployment Rate4.
Fiscal Balance (% of GDP)-3.4-2.5-1.1-2.1-1.6
Public Debt (% of GDP)45.449.446.946.847.1
Money (annual variation in %)
Inflation Rate (CPI, annual variation in %, eop)
Inflation Rate (CPI, annual variation in %)
Inflation (PPI, annual variation in %)1.310.
Policy Interest Rate (%)3.255.757.258.257.25
Stock Market (annual variation in %)-
Exchange Rate (vs USD)17.1820.7319.6519.6518.93
Exchange Rate (vs USD, aop)15.8818.6918.9119.2319.25
Current Account (% of GDP)-2.7-2.3-1.8-2.1-0.3
Current Account Balance (USD bn)-31.0-24.3-20.4-25.3-4.3
Trade Balance (USD billion)-14.7-13.1-11.0-13.65.4
Exports (USD billion)381374409451461
Imports (USD billion)395387420464455
Exports (annual variation in %)-4.1-1.79.510.12.2
Imports (annual variation in %)-1.2-2.18.610.4-1.9
International Reserves (USD)177177173175181
External Debt (% of GDP)35.638.337.636.536.8

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Mexico Facts

Value Change Date
Bond Yield6.87-0.24 %Dec 31
Exchange Rate18.93-0.29 %Jan 01

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