Mexico needs more effort to lower debt, IMF says
EWW•The IMF said Mexico needs greater efforts to put debt on a declining trajectory and projected economic growth of 1.5% in 2026 and 1.8% in 2027. Mexico’s draft 2027 budget projects public debt rising to 55.0% of GDP from an estimated 54.0% at the end of 2026.
1. Debt and budget outlook
The IMF said greater efforts are needed to put Mexico’s debt on a declining trajectory, even as fiscal consolidation continues in 2026. It said the draft 2027 budget entails more gradual consolidation than previously announced and an upward debt trajectory in coming years; the budget projects public debt at 55.0% of GDP, up from an estimated 54.0% at the end of 2026.
2. Growth and inflation
The IMF projected Mexico’s economy will grow 1.5% in 2026 and 1.8% in 2027, with growth constrained mainly by external uncertainty. It called for monetary policy to remain moderately tight and said geopolitical tensions and El Niño could add price pressure, delaying a durable return to Banxico’s 3% inflation target until early 2028. Banxico held its benchmark rate at 6.50% in September and expects inflation to reach its target in the fourth quarter of 2027.
3. Reform priorities
The IMF said revenue mobilization, better spending prioritization and greater private-sector involvement are needed to protect growth-enhancing investment. It also cited infrastructure gaps, regulatory burdens, trade integration, security, corruption and informality as areas affecting Mexico’s growth potential.
