Mexico’s 2026 growth forecast remains bleak at just 1% amid deep structural flaws
Mexico’s economic outlook for 2026 remains sluggish, with growth forecasts hovering around just 1%. Analysts point to deep-rooted issues like weak investment, declining public institutions, and a long-standing productivity crisis. The situation has raised concerns about the country’s ability to sustain stronger expansion in the coming years.
For years, major Mexican institutions—including state-owned enterprises like the national oil company PEMEX and key government bodies—have scaled back or postponed investment plans. These delays have eroded investor trust and contributed to the current stagnation. The problem extends beyond external pressures, with domestic factors such as poor returns on public projects and institutional decline playing a significant role.
Economists warn that even major events, like the 2026 FIFA World Cup, will do little to boost growth. Most required stadiums are already in place, limiting any potential economic uplift from the tournament. Meanwhile, the renegotiation of the USMCA trade agreement could offer some relief, according to Ernesto Revilla, Citi’s chief economist for Latin America. He suggests that updated trade terms might help revive stalled investment. Yet credibility issues persist. Revilla has compared the central bank’s inflation forecasts to the Finance Ministry’s past oil production estimates—both of which repeatedly underestimated declines. This pattern has fuelled doubts about the bank’s ability to manage economic expectations. Carlos Capistrán, Bank of America’s chief economist, echoes these concerns, identifying Mexico’s core challenge as a severe productivity crisis that has kept growth subdued for years. Projections for 2026 remain cautious. Citi expects growth of just 1%, while Bank of America forecasts a slight uptick to 1.2%. Neither institution anticipates a meaningful shift, even if global uncertainty eases.
Mexico’s economy faces a prolonged period of weak expansion, with growth forecasts for 2026 staying below 1.5%. The combination of delayed investments, institutional decline, and a productivity crisis leaves little room for short-term improvement. Without structural changes, analysts see few catalysts for a stronger recovery in the near future.
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