Illustration of Mexico's economy showing GDP contraction with charts and Mexico City skyline
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Mexico economy contracts 0.6 percent in first quarter of 2026

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Mexico's gross domestic product fell 0.6 percent in the first quarter compared with the prior period, according to final Inegi data released Friday. The contraction was smaller than expected and revives debate over possible further rate cuts by Banxico.

The National Institute of Statistics and Geography reported that GDP contracted 0.6 percent quarter on quarter between January and March. The final figure beat the preliminary reading of minus 0.8 percent and analyst expectations.

Compared with the same period of 2025, GDP grew 0.2 percent. The decline was concentrated in agriculture, manufacturing and services.

Banxico cut its key rate to 6.50 percent in early May in a divided three-to-two vote. The board then signaled the end of its two-year monetary easing cycle.

Analysts such as Alberto Ramos of Goldman Sachs noted that the threshold for additional cuts is not high if growth remains weak. Banxico will release its next quarterly report on May 27.

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Initial reactions on X highlight the smaller-than-expected GDP contraction in Mexico's Q1 2026, with discussions focusing on implications for Banxico rate cuts, sectoral weaknesses, and concerns over economic slowdown under the current government. Some users express skepticism about official narratives, while analysts provide detailed breakdowns and revised forecasts.

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Illustration of Mexico's inflation rising to 4.63% in March 2026, featuring a market scene with rising prices and a billboard display.
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Mexico's annual inflation rises to 4.63% in early March

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Mexico's National Institute of Statistics and Geography (Inegi) reported annual inflation at 4.63% for the first half of March 2026, exceeding analysts' estimates. The National Consumer Price Index (INPC) rose 0.62% from the previous half-month period.

Mexican economy shows signs of slowdown in February

Preliminary February 2026 data point to a loss of momentum in the Mexican economy after a promising January start. Car sales dipped slightly and formal employment grew weakly, though there are no signs of recession.

Banxico ends rate cut cycle and sets rate at 6.50%

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Banco de México cut its interest rate by 25 basis points to 6.50 percent, ending a cycle of reductions that began in March 2024. The move followed April inflation slowing to 4.45 percent annually. Two board members voted against the decision.

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Mexico to pay lower tariffs under Trump's 10% global levy: Ebrard

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Marcelo Ebrard, secretary of Economy, stated that Mexico will improve its relative position against the United States due to Donald Trump's announced 10 percent global tariff. The official noted that the average effective tariffs on Mexican exports will drop from 4.1 percent to around 2 percent. Meanwhile, Mexico's inflation rose to 3.92 percent in the first half of February, driven by new taxes and tariffs on Asian imports.

Banco Mundo Mujer reports 4.44 percent profit decline in first quarter

Banco Mundo Mujer posted a net profit of 25.94 billion pesos in the first quarter of 2026. The figure marks a 4.44 percent drop from the same period last year.

Bogotá's GDP rises 4.6% in Q3 2025, topping national 3.6% growth

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