Mexico economy beats forecasts in third quarter, cooling rate-cut pressure
SPY•Mexico’s GDP grew 0.9% quarter over quarter in the third quarter, above the 0.7% forecast but below second-quarter growth of 1.4%. The stronger reading weakened the case for an immediate rate cut, while the finance minister maintained the government’s 1%-2% full-year growth forecast.
1. Growth beats expectations
Mexico’s economy grew 0.9% in the July-to-September period, compared with analysts’ 0.7% forecast, preliminary data showed. Growth slowed from 1.4% in the second quarter. On an annual basis, GDP rose 3.2%, above economists’ 2.5% expectation.
2. Sectors and rate outlook
Services expanded 1.1% and industry, including manufacturing and construction, grew 0.8%; primary activities such as agriculture and mining contracted 0.4%. Analysts said the stronger reading weakened the case for an immediate rate cut ahead of Banxico’s policy decision next week. One economist said the data reinforced expectations that the benchmark rate would remain at 6.50% through the first half of 2027.
3. Government growth forecast
Finance Minister Edgar Amador maintained the ministry’s forecast for full-year growth of 1% to 2%, adding that growth in 2026 could reach the upper end of the government’s forecast range if current momentum is sustained.
