Citi Mexico Expectations Survey (May 4, 2026)

• Consensus now expects the next Banxico rate cut of 25bps at the May meeting. In today’s Citi Mexico Expectations Survey, the median estimate for the next move in the monetary policy rate is for a 25bps cut on the May 7 meeting. Of the 35 respondents, 32 expect the next cut at this week’s meeting (from 14 in the last survey), while 3 expect the next cut at the June meeting (from 17 a fortnight ago). The median forecast for the policy rate by end-2026 remains unchanged at 6.5%, with estimates ranging from 6.50% to 6.25%. For end-of-2027, the median expectation is 6.50%, with estimates ranging from 7.00% to 5.75%.
• Peso expectations are stable. The consensus expects USDMXN to be at 18.10 by end-2026, as the previous survey, with expectations ranging from 17.0 to 19.03. For end-2027, consensus expects USDMXN to be at 18.75, as a fortnight ago.
• For April, the consensus projects monthly headline and core inflation at 0.28% and 0.31%, respectively. For the full month of April, analysts expect headline inflation at 0.28% MoM or 4.53% YoY, lower than March’s figure of 4.59% YoY and higher than the survey a fortnight ago (0.18% MoM). Core inflation in March is expected at 0.31% MoM, or 4.26% YoY, from 0.32% in last survey, and lower than the figure from the previous month of 4.45% YoY. For May, consensus expects monthly headline and core inflation at -0.02% MoM and 0.28% MoM, respectively.
• Inflation projections increased. The median projection for headline inflation for yearend 2026 is now at 4.35% from 4.26% a fortnight ago; for the core component, the median was kept at 4.20% from the last survey. For year-end 2027, the headline inflation expectation was revised upwards to 3.87% from 3.80% a fortnight ago; for the core component, it increased to 3.85% from 3.80% in the last survey. The median expectation for the average annual inflation rate in 2028–32 is now at 3.79%, one basis point higher from the previous survey.
• GDP growth expectations decreased for this year. The median GDP growth projection for 2026 decreased to 1.2% from 1.4% in the last survey, with the range of estimates going from 0.7% to 1.8%. For 2027, survey respondents expect GDP growth to be at 1.8%, as in the previous survey.
   

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