Mexico Economy Beats Expectations in Fourth Quarter, Largest Expansion In a Year

• Mexico's economy grew more than expected in the fourth quarter, registering its strongest quarterly expansion in more than a year, official data showed on Monday.
• Latin America's second-largest economy grew 0.9% in the fourth quarter, slightly above a preliminary estimate published last month by the National Institute of Statistics and Geography (INEGI) and forecasts from economists in a Reuters poll, both of which pointed to a 0.8% expansion.
• The data was an improvement from a revised 0.1% expansion in the third quarter, data from INEGI showed, and marked the strongest performance since the third quarter of 2024.
• The economy was mainly fueled by the secondary sector, which includes manufacturing and construction, and tertiary activities, which both grew 0.9% compared with the prior quarter. Those increases made up for the 1.4% contraction from primary activities, which include farming, fishing and mining. In annual terms, the economy expanded 1.8% in the quarter compared to a year earlier, also above expectations.
• Despite the solid fourth-quarter data, analysts have remained cautious about Mexico's economy in 2026, expecting a slow track amid high uncertainty as the review of the USMCA trade deal with the United States and Canada approaches.
• Throughout last year, the Mexican economy grew by 0.8% on a seasonally adjusted basis, a figure also slightly higher than the 0.7% estimate previously provided by INEGI.

(Source: Reuters)