Mexico’s economy recorded 0% growth in May compared to the previous month and expanded just 0.4% in annual terms, according to seasonally-adjusted data published by the national statistics agency INEGI on Tuesday.
It was the second-worst month-over-month result for the Mexican economy this year after a 0.2% contraction in March.
En mayo 2025, y con cifras desestacionalizadas, el Indicador Global de la Actividad Económica #IGAE presentó las siguientes variaciones:
↔️ 0.0% mensual
⬆️ 0.4% anualPor componente, las variaciones mensuales fueron:
⬆️ 3.6% primarias
⬆️ 0.6% secundarias
⬇️-0.4% terciarias— INEGI INFORMA (@INEGI_INFORMA) July 22, 2025
U.S. tariffs on various imports from Mexico, including steel, aluminum and vehicles, are weighing on the economy and creating uncertainty for investors.
U.S. President Donald Trump recently doubled the duty on steel and aluminum to 50%, and earlier this month informed President Claudia Sheinbaum that on Aug. 1, he would impose a 30% tariff on “Mexican products sent into the United States, separate from all Sectoral Tariffs.”
The publication of the growth data for May comes four days after INEGI released preliminary data showing that the Mexican economy grew 0.2% in June compared to the previous month and 1.3% in annual terms.
Services sector contracts compared to April
INEGI’s data shows that Mexico’s tertiary or services sector contracted 0.4% in May compared to the previous month. Within that sector, the cultural and sporting services industry recorded the largest contraction, shrinking 3.4% in the space of a month.
Valeria Moy, an economist and director of the Mexican Institute for Competitiveness, said on X that the 0% month-over-month growth in May is due to the decline in the services sector, “which is precisely where economic activity is concentrated.”
Mexico’s primary sector, which includes farming and fishing, grew 3.6% in May compared to April, while the secondary sector expanded 0.6%.
Within the secondary sector, the construction industry grew 2.8% on a month-over-month basis, while manufacturing output increased just 0.1%.
The mining industry, which is also part of the secondary sector, declined 1.1% in May, while the electricity, water and gas industry grew 0.4%.
Secondary sector shrinks in annual terms, primary sector grows more than 5%
INEGI reported that the secondary sector contracted 0.4% in May compared to the same month of last year.
The mining (-8.4%), electricity/water/gas (-3.8%) and construction (-1%) industries all declined in annual terms.
The manufacturing industry grew 1.4% compared to May 2024.
The primary sector grew 5.4% annually in May while the services sector expanded 0.6%.
Annual growth below 1% in first half of 2025, says analyst
Taking the latest data from INEGI into account, the director of economic analysis at Banco Base calculated that the Mexican economy grew around 0.72% in the second quarter of 2025 compared to the first three months of the year, and 1.11% in annual terms.
World Bank forecasts 0.2% growth for Mexico, citing persistent global ‘turbulence’
In a post to X, Gabriela Siller said that the data indicates that the Mexican economy grew 0.84% in annual terms in the first six months of 2025. That result, she said, is the lowest growth rate for the first half of any year since 2020, when the COVID-19 pandemic and associated restrictions ravaged the economy.
The International Monetary Fund is currently forecasting that the Mexican economy will contract 0.3% in 2025, while the World Bank is predicting growth of 0.2%.
Mexico’s Finance Ministry is more optimistic, forecasting growth in the range of 1.5%-2.3% in 2025.
President Sheinbaum has rejected forecasts from international financial organizations, asserting that they don’t take into account federal government efforts to stimulate the economy, including through its Plan México initiative.
With reports from El Economista and Bloomberg Línea
