Mexico’s economy will grow 1.3% in 2026.
The Mexican peso will trade at 19 to the US dollar at the end of the year.
The headline inflation rate will be 4% at the close of 2026.
The Bank of Mexico’s benchmark interest rate will be 6.5% at year’s end.
These are some of the consensus forecasts derived from the latest Citi México Expectations Survey, for which 35 banks, brokerages and research organizations were asked to provide economic predictions for Mexico.
The survey results, which include forecasts from major banks such as BBVA, Banorte, Barclays and Bank of America, were published on Tuesday.
Growth forecasts range from 0.6% to 1.8%
The median 1.3% growth forecast for the Mexican economy in 2026 represents an increase of 0.1 percentage points compared to the consensus prediction derived from Citi’s previous expectations survey in mid-December.
The most optimistic forecast came from Banorte, which is predicting a 1.8% GDP expansion this year.
The gloomiest outlook came from Scotiabank México, which is forecasting that the Mexican economy will grow just 0.6% in 2026.
The median forecast is well below the 1.8%-2.8% growth prediction made by the federal Finance Ministry in its 2026 budget proposal. The government hopes that strong foreign investment inflows, World Cup-related tourism and a positive outcome from the USMCA review will be among the factors that spur growth in Mexico this year.
Citi also asked financial institutions to predict Mexico’s GDP growth rates in 2025 — for which final data has not yet been published — and 2027.
The median forecast was that the Mexican economy grew 0.4% last year, on par with the growth rate in the first nine months of the year.
The consensus outlook among the 35 survey respondents is that the Mexican economy will grow 1.8% in 2027.
Peso predicted to weaken this year
The Mexican peso was trading at 17.96 to the US dollar early on Wednesday afternoon, a slight appreciation compared to its position at the close of trading on the final day of 2025.
The consensus forecast derived from Citi’s latest survey is that the peso will trade at 19 to the greenback at the end of 2026. Such an eventuality would represent a depreciation of just over 5% for the peso.
The end-of-year USD:MXN exchange rate forecasts ranged from 17.10 (from the company XP Investments) to 20.30 (from Banca Mifel).
The consensus forecast is that the peso will depreciate further in 2027 to end that year at 19.50 to the US dollar.
Defying expectations, the peso appreciated significantly in 2025, ending the year at 18 to the greenback after finishing 2024 at close to 21.
Inflation forecast to increase
The median forecast of the institutions surveyed by Citi is that Mexico’s annual headline inflation rate will be 4% at the end of 2026. Such a reading would represent a slight increase from the 3.72% rate recorded in the first half of December.
For its part, the Bank of Mexico is predicting that inflation will converge to its 3% target in the third quarter of this year and remain at that level in the fourth quarter of 2026 and throughout 2027.
Among the respondents to Citi’s survey, the end-of-year inflation forecasts ranged from 3.29% (from Signum Research) to 4.40% (from Banorte).
The consensus forecast was that Mexico’s headline inflation rate will be 3.70% at the end of 2027.
Additional interest rate cuts expected
All but one of the respondents to Citi’s survey predicted that the Bank of Mexico’s key interest rate will be lower at the end of 2026 than its current 7%.
The median forecast is that the rate will be 6.50% at the end of 2026, after two 25-basis point cuts over the course of the year.
Santander México was the only respondent that said that the central bank’s benchmark rate will remain at 7% at the end of 2026.
The lowest end-of-year interest rate prediction came from the Bank of America, which anticipates cuts totaling 100 basis points to lower the rate to 6% at the close of 2026.
The Bank of Mexico’s first monetary policy decision of the year will be made on Feb. 5. The bank lowered its benchmark interest rate after all eight of its monetary policy meetings in 2025, shaving a total of 300 basis points off borrowing costs over the course of the year.
The median forecast among the 35 respondents to the latest Citi survey is that the Bank of Mexico’s key interest rate will be 6.50% at the end of 2027. Seven of the respondents anticipate a 6.00% interest rate at the end of next year, while one — the Mexican bank Bankaool — is forecasting a 5.50% rate at the close of 2027.
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