Mexico’s economy expanded at a slightly slower pace than expected in the second quarter of 2025, according to preliminary data released by the National Institute of Statistics and Geography (INEGI) on July 30, 2025. The country’s gross domestic product rose 2.1% year-on-year, missing the 2.2% consensus forecast. On a quarter-over-quarter basis, one reported measure showed growth of 1.4%, below the 1.5% forecast and down from 1.6% in the first quarter, while seasonally adjusted figures pointed to a 0.5% quarterly expansion after 0.2% in the prior three months.
The services sector remained the primary engine of growth, expanding 2.4% annually, and agricultural output increased 3.1%. Industrial activity, however, was more subdued, rising 1.5% year-on-year as manufacturing output moderated and construction remained weak amid softer external demand.
The slight miss against forecasts comes at a delicate moment for Banxico. The central bank has been balancing efforts to tame inflation against signs of a cooling economy. Analysts said softer GDP data could strengthen the case for a rate cut at the central bank’s August policy meeting, especially if inflation continues to trend lower. In response to the release, the Mexican peso was relatively stable at around 18.2 per US dollar, as investors weighed the growth outlook against global trade uncertainties and a moderating US economy.
For businesses and investors, the report suggests consumer demand remains resilient but is not expanding as quickly as hoped. Economists may revise full-year growth projections lower, while the data reinforces a data-dependent approach to monetary policy. Although the growth miss was marginal, it highlights the balance between domestic strength and external pressures facing Mexico.
