Daily: Mexico Economic 28.01.2026

FEATURED STORY

Mexico's Central Bank Likely to Pause Rate Cut Cycle Amid Tariff Concerns

• The Bank of Mexico (Banxico) announced it will likely pause its interest rate cut cycle at its first monetary policy meeting in February. In its 2026 Monetary Program report, the central bank will assess the inflationary impact of new tariffs on products from China and Asia when evaluating future adjustments to its reference rate, currently at 7%.
• Governor Victoria Rodríguez Ceja explained that fiscal changes and tariffs present challenges for monetary policy in 2026. Banxico will consider additional rate cuts only if increases to the Special Tax on Production and Services (IEPS) and tariffs on Chinese goods do not impact other prices. While forecasting faster economic growth this year and strength in exports, monetary officials warned of downside risks stemming from uncertain trade relations with the US. The central bank also presented its 2026 Monetary Program, reaffirming its 3% inflation target and emphasizing that credibility is crucial for reducing inflation.

Sheinbaum Convenes Financial Leadership to Discuss Economic Outlook and Plan México

• President Sheinbaum held a high-level meeting at the National Palace with Centeal Bank Governor Victoria Rodríguez Ceja and senior executives from the Mexican Banking Association (ABM) to discuss the country's economic perspectives and advance the Plan México development agenda.
• The meeting, included Finance Minister Édgar Amador Zamora and the head of the Digital Transformation and Telecommunications Agency José Antonio Peña Merino. From the ABM it brought together CEOs from major banks including Banorte's Marcos Ramírez, BBVA's Eduardo Osuna, Banamex's Manuel Romo, HSBC's Jorge Arce, and representatives from Bank of America, Santander, Scotiabank, and Nu México.
• According to Ramírez, the discussion centered on accelerating financing to support upcoming investments, expanding financial inclusion and digitalization—including Banxico's CoDi digital payment platform—and making Plan México a long-term, cross-administration development strategy.
• Sheinbaum emphasized the importance of coordination between government and the financial sector while respecting Banxico's autonomy, describing this institutional dialogue as essential for addressing Mexico's economic challenges amid international uncertainties, particularly regarding tue US trade relations.

MACROECONOMIC INDICATORS

IMF Maintains Mexico's 2026 Growth Estimate at 1.5%

• The International Monetary Fund (IMF) confirmed its economic growth forecast for Mexico in 2026, projecting 1.5%. This calculation is framed within a global context showing moderate recovery, though uncertainties persist regarding inflation and macroeconomic stability. The IMF's assessment is critical for economic policy formulation in Mexico, as it influences investment decisions and external financing.

Private Consumption Posts Steepest Drop Since 2020

• BBVA Research reported a 4.1% decline in Mexico's private consumption in December 2025, the largest contraction since April 2020. Analyst Saide Salazar noted the decline was driven by decreases in spending on goods (2.0%) and services (7.3%) amid economic uncertainty and deteriorating consumer confidence. The Consumer Confidence Indicator (ICC) from INEGI fell 2.4 points.

International Reserves Reach $255 Billion on Gold Valuation

• Mexico's international reserves reached $254.98 billion as of the week ending January 23, according to Banxico. The increase of $1.76 billion was primarily driven by higher valuation of international assets, particularly gold, which now represents $16.18 billion of the total. Additionally, the Mexican Oil Fund for Stabilization and Development (FMPED) contributed $123 million following foreign currency sales to Banxico.

TRADE AND FOREIGN INVESTMENT

Mexico Closes 2025 with Trade Surplus and Export Growth

• Mexico concluded 2025 with a trade surplus of $771 million, a dramatic turnaround from the $18.54 billion deficit in 2024, according to the National Institute of Statistics and Geography (INEGI). This shift was driven primarily by a surplus in non-petroleum products of $26.32 billion, while the petroleum products deficit increased to $21.23 billion.
• Total exports grew 7.6% year-over-year in 2025, reaching $664.07 billion and positioning exports as the economy's engine for the second consecutive year. This growth outpaced global goods trade growth of 6%. Imports also hit record highs with a 4.4% increase, resulting in the first surplus after four years of deficits.
• However, automotive exports fell 3.7% in December 2025, affected by U.S.-imposed tariffs, while imports surged 16.7% to $58.2 billion. The December trade surplus reached $2.4 billion, combining an increase in non-petroleum exports with a petroleum deficit.

Northeast Region Leads Competitiveness, Attracting Investment

• The Northeast Region, comprised of Coahuila, Nuevo León, San Luis Potosí, and Tamaulipas, ranked as the country's most competitive according to the Mexican Institute for Competitiveness (IMCO) 2026 Regional Competitiveness Index (ICR). IMCO Director Valeria Moy highlighted that this region scored 62.33 points out of 100, with outstanding performance in talent retention and investment attraction, though facing challenges in security and housing supply.
• KPMG's 2026 Senior Management Perspective study revealed that 42% of executives plan to expand operations nationally, with Mexico City, Nuevo León, and Estado de México as the most attractive entities, while maintaining uncertainties due to trade relations with the United States.

UK Financial Institutions Eye Mexican Banking Market

• Mexico's banking market has attracted more British financial institutions seeing growth opportunities. UK Ambassador to Mexico Susannah Goshko announced that Guavapay and Unlimit are interested in obtaining banking licenses in the country. Revolut's entry has catalyzed other fintechs to consider investing in Mexico's financial market.
• Revolut has officially launched operations in Mexico, promising to reduce remittance costs and incorporate over 20 million people into the financial system, aligning with Plan Mexico's objectives to close economic gaps and promote digitalization.

FISCAL & TAX POLICY

Mexico’s Tributary System presented the 2026 Master Plan to increase tax collection

• The Tax Administration Service (SAT) presented its 2026 Master Plan, which seeks to achieve a historic revenue collection target of 5.8 trillion pesos. This plan includes specific actions to combat the purchase and sale of false invoices, as well as a 30-day period for taxpayers to correct their tax situation upon receiving invoices that are declared false. Domingo Ruíz López, from the Mexican Academy of Tax Law, warned that these measures must be careful not to violate taxpayers' rights.

Businessman Ricardo Salinas' Grupo Salinas will pay tax debts to Mexico’s Tributary System

• President Sheinbaum reported that Ricardo Salinas Pliego's companies began talks with the SAT this week to settle a debt of 51 billion pesos, after the businessman expressed his intention to comply with the payment. The president clarified that this is not a political negotiation but rather a matter of applying the law, with the possibility of adjustments of up to 39%, while the Supreme Court validated that only collegiate courts can resolve the case. At the same time, Salinas Pliego reiterated the possibility of running for president in 2030, although he said that his current priority is to close the tax agreement and avoid seizures.

INDUSTRY & MARKET

Steel Industry Faces Unprecedented Crisis from US Tariffs

• The National Chamber of Iron and Steel Industries (Canacero) warned of an unprecedented crisis in the steel sector due to 50% tariffs imposed by the US. Canacero President Víctor M. Cairo reported that the industry is operating at less than 60% of installed capacity, putting jobs and investments at risk. In 2025, exports fell 49%, exacerbated by unfair competition from Asian steel imports.

State oil company PEMEX Reports Historic Production Low

• PEMEX reported an average production of 1.635 million barrels per day of hydrocarbons in 2025, marking a 7.1% annual decline. This represents the lowest production level in 35 years, with 83.6% corresponding to crude oil. Crude exports also decreased, averaging 581,000 barrels per day, generating lower revenues for the country.

Chinese Auto Brands Face Customer Service Crisis

• Chinese automotive brands, including Chirey and Solarever Electric Vehicles (SEV), are facing mounting customer complaints following the closure of several dealerships in Mexico. Users have reported difficulties accessing maintenance and warranties, as well as lack of response to mechanical failures. Meanwhile, EY reported a drop in interest for electric vehicles in Mexico, with only 23% purchase intention in 2025, citing lack of charging infrastructure, high costs, and distrust in new technologies as key barriers.