Mexico’s economy grew 0.9% in the third quarter, beating forecasts
Mexico’s economy grew faster than expected in the third quarter of 2026, even as the pace slowed. Gross domestic product rose 0.9% from July to September, according to a preliminary estimate from the national statistics agency, INEGI, published on Friday, 30 October.
The figure beat the 0.7% increase economists had expected in a Reuters poll, although it was down from 1.4% growth in the second quarter. Year on year, the economy grew 3.2%, above the 2.5% rise economists had forecast.
Services led the expansion: services grew 1.1% over the quarter, manufacturing and construction rose 0.8%, while farming, fishing and mining fell 0.4%.
Mexico is Latin America’s second-largest economy, and the result suggests its recovery has held up better than many analysts feared. “Mexico’s economy maintained solid momentum in Q3, confirming that the recovery extends beyond the temporary boost from the FIFA World Cup,” Andres Abadia, chief economist for Latin America at Pantheon Macroeconomics, said.
The figures are preliminary and could be revised. Even so, the stronger reading has changed rate expectations: Mexico’s central bank, Banxico, decides on policy next week, and analysts said continued growth has weakened the case for cutting rates.
Why it matters
The result matters because Mexico’s economy had been expected to cool sharply under pressure from high borrowing costs and trade uncertainty with the United States, its largest trading partner. Growth of 0.9%, with services and manufacturing both expanding, points to demand at home holding up rather than fading.
It also matters for the cost of borrowing. Abadia said the stronger recovery reinforced expectations that Banxico would keep its benchmark interest rate at 6.50% through the first half of 2027. Capital Economics added that the bank’s message next week would be “much less dovish” than after its September meeting — fewer signals of rate cuts to come.
What happens next
Banxico’s decision next week is now the key event to watch, as the bank says whether it sees room to cut rates or prefers to hold them steady while growth stays firm. INEGI’s full figures will follow and could revise the estimate up or down.
Economists will also watch whether momentum carries into the final quarter. If services and manufacturing keep growing, Mexico could end 2026 stronger than forecasters expected a few months ago.
This article is for general information and education only. It is not legal or financial advice.
Sources
- https://wixx.com/2026/10/30/mexicos-economy-slows-less-than-expected-in-third-quarter/ (Reuters, via WIXX, 30 October 2026)
- https://935thelloyd.com/2026/10/30/mexicos-economy-slows-less-than-expected-in-third-quarter/ (Reuters, via 935 The Lloyd, 30 October 2026)
- https://mexicobusiness.news/policyandeconomy/news/mexico-3q2026-gdp-expands-09 (Mexico Business News, 30 October 2026)
