Citi Mexico Expectations Survey (August 5, 2025)

Consensus continues to expect a 25bps rate cut in the August meeting. In today’s Citi Mexico Expectations Survey, most participants expect that the next move in the monetary policy rate will be in August 2025, and all expect a 25bps cut as the next move. Out of 39 participants, 38 expect a cut in August, while just one analyst expects it in September. The median forecast for the policy rate by Y/E 2025 was kept at 7.50% compared to five fortnights ago, with estimates ranging from 7.00% to 7.75%. For Y/E 2026, the policy rate median expectation was kept at 6.75% compared to the previous survey.

Peso expectations were reduced again for 2025 and 2026 y/e. The consensus projects the USDMXN at 19.60 for Y/E 2025, lower than 19.85 in the previous survey. For y/e 2026, it is at 20.16, lower than 20.30 in the previous survey.

For July, the consensus projects monthly headline and core inflation at 0.28% and 0.30%, respectively. For the full month of July, analysts expect headline inflation at 0.28%MoM, 3.53% YoY, lower than June’s rate of 4.32%YoY and lower than the survey a fortnight ago (0.38%MoM). Core inflation is now estimated at 0.30%MoM in July, or 4.22%YoY, slightly lower than the figure from the previous month of 4.24%YoY and lower than the previous survey at 0.34%MoM. For August, consensus expects monthly headline and core inflation at 0.26%MoM and 0.25%MoM, respectively.

Core Inflation expectations increased again for Y/E 2025. Headline inflation projections for Y/E 2025 were kept at 4.00% as in the previous survey, while for the core component, it is now at 4.10% from 4.03% a fortnight ago. For Y/E 2026, the headline median expectation is now at 3.76% from 3.80%, while core inflation median estimation was kept at 3.70%, both compared to the previous survey. The median expectation for the average annual inflation rate in 2027-2031 remained unchanged compared to the previous survey at 3.70%.

GDP growth median expectations increased for 2025 and 2026. The consensus estimates 2025 GDP growth at 0.3%, from 0.2% in the last survey, with estimations ranging from -0.3% to 0.8%. For 2026, it was increased to 1.4% from 1.2% in the previous survey.

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