By Gabriel Burin<\/p>\n
BUENOS AIRES, April 20 (Reuters) – Mexico’s economy will remain stuck in mild stagflation in 2026, a Reuters poll of economists found, held back by uncertainty over its trade deal with the U.S. \u200cand Canada.<\/p>\n
Latin America’s No. 2 economy is forecast to log a third consecutive year of growth under 2% \u200cwith inflation close to or at the limit of the central bank’s target in 2026, the longest streak of such conditions since 2001-2003.<\/p>\n
Mexico should begin \u200bto emerge from the current period of near-stagnation and relatively high inflation next year, the poll showed.<\/p>\n
This year, gross domestic product is set to grow 1.5%, accelerating from last year’s 0.6% growth, according to the median estimate of 35 analysts polled between April 13 and April 17.<\/p>\n
The 2026 forecast was slightly above a 1.3% rate predicted in a January poll, while the 1.9% \u200cmedian estimate for 2027 was the same \u2060as in the previous survey.<\/p>\n
Grupo Banorte economists wrote in a report on Friday they were optimistic about trade as well as positive effects from the football World Cup in June-July, and expected \u2060an acceleration in public investment.<\/p>\n
However, consensus forecasts for average annual inflation rose to 4.0% from 3.8% this year and to 3.8% from 3.7% in 2027, partly due to the impact of the U.S.-Israeli war with Iran on energy prices.<\/p>\n
Mexico’s central bank has an inflation \u200btarget \u200bof 3%, plus or minus a percentage point. The consensus view \u200bin the poll was it would end a \u200clong easing cycle this quarter with one last 25 basis-point interest rate cut to 6.50%.<\/p>\n
TRADE DEAL SCENARIOS<\/p>\n
On the future of the deal with Mexico’s North American trading partners, Rodolfo Mitchell, Scotiabank’s Mexico head economist, said the most favorable scenario for the country would be a ratification of the current scheme.<\/p>\n
A second best for Mexico may be an inconclusive negotiation this year but with a possible agreement on a system of annual reviews of the USMCA agreement.<\/p>\n
“The worst-case scenario would be a formal \u200crenegotiation of the treaty since Mexico has very limited room for \u200bnegotiation and would probably end up accepting most of the changes proposed \u200bby the U.S.,” Mitchell said.<\/p>\n
This may include stricter rules \u200bof origin for U.S. products as well as non-trade provisions like migratory arrangements that would be “clearly \u200cnegative as it would politicize USMCA and reduce \u200bits legal certainty.”<\/p>\n
Alfredo Coutino, director at \u200bMoody’s Analytics, said a trade agreement in the second half of the year, past a July 1 deadline, was more likely than no agreement.<\/p>\n","protected":false},"excerpt":{"rendered":"By Gabriel Burin BUENOS AIRES, April 20 (Reuters) – Mexico’s economy will remain stuck in mild stagflation in…\n","protected":false},"author":2,"featured_media":595928,"comment_status":"","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[36],"tags":[28,101,259812,26,3925,23264],"class_list":["post-595927","post","type-post","status-publish","format-standard","has-post-thumbnail","category-economy","tag-business","tag-economy","tag-median-estimate","tag-mexico","tag-mexico-city","tag-reuters-poll"],"_links":{"self":[{"href":"https:\/\/www.newsbeep.com\/us\/wp-json\/wp\/v2\/posts\/595927","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.newsbeep.com\/us\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.newsbeep.com\/us\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/us\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/us\/wp-json\/wp\/v2\/comments?post=595927"}],"version-history":[{"count":0,"href":"https:\/\/www.newsbeep.com\/us\/wp-json\/wp\/v2\/posts\/595927\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/us\/wp-json\/wp\/v2\/media\/595928"}],"wp:attachment":[{"href":"https:\/\/www.newsbeep.com\/us\/wp-json\/wp\/v2\/media?parent=595927"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.newsbeep.com\/us\/wp-json\/wp\/v2\/categories?post=595927"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.newsbeep.com\/us\/wp-json\/wp\/v2\/tags?post=595927"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}