Citi Mexico Expectations Survey (July 7, 2025)

Consensus expects 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 38 participants, 33 expect a cut in August while 4 analysts expect it in September. The median forecast for the policy rate by Y/E 2025 was kept at 7.50% from three 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% from the previous survey.

Peso expectations were reduced again for 2025 and 2026 y/e. The consensus projects the USDMXN at 20.00 for Y/E 2025, lower than 20.20 in the previous survey. For y/e 2026, it is at 20.50 from 20.70 in the previous survey.

For June, the consensus projects monthly headline and core inflation at 0.27% and 0.36%, respectively. For the full month of June, analysts expect headline inflation at 0.27%MoM (4.31% YoY), lower than May’s rate of 4.42% and marginally higher than the survey a fortnight ago (0.26%MoM). Core inflation is now estimated at 0.36%MoM in June, or 4.21%YoY, higher than the figure from the previous month of 4.06%YoY and higher than the previous survey at 0.30%MoM. For July, consensus expects monthly headline and core inflation at 0.36%MoM and 0.28%MoM, respectively.

Inflation expectations increased for Y/E 2025 and 2026. Headline inflation projections for Y/E 2025 increased to 4.00% from 3.90% in the previous survey, while for the core component, it is now at 4.00% from 3.95% a fortnight ago. For Y/E 2026, the headline median expectation is now at 3.80% from 3.75%, while core inflation median estimation is higher at 3.73% from 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 expectation increased marginally from 2025 and 2026. The consensus estimates 2025 GDP growth at 0.2%, from 0.1% in the last survey, with estimations ranging from -0.6% to 0.7%. For 2026, it was increased to 1.3% from 1.2% in the previous survey

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