6.50%
Banxico holds its policy rate and pauses further cuts
+19.5%
Public investment — the only source of capital formation growth
USD 298.2 bn
Record Mexican exports to the US in the first half
Economy
Banxico decided to leave its main interest rate at 6.50% and paused further downward revisions, even though inflation slowed to 3.10%, because the core component stands at 3.95%. It also extended its estimate of convergence with the official 3% target to the last quarter of 2027, instead of the second. Beyond the core component's evolution, other risk factors are disruptions from US trade policy, inflation from geopolitical conflicts, adverse climate affecting certain sectors, higher cost prices, and a depreciation of the peso.
In May, for the second consecutive month, gross fixed capital formation grew, this time at a more moderate annual rate of 2.4%. All growth came from the public sector — even though it has been contained to control the deficit — which increased 19.5%, while private investment grew only 0.2%.
Construction statistics have been particularly questioned by some analysts; others point to a rebound from a very poor comparative base, as well as works related to the World Cup, and thus one-off in nature.
Foreign trade and relations, US–Mexico and USMCA
The Justice Department and the DEA said members of the Mexican government actively protect CJNG, one of the two most powerful criminal cartels. They announced an unprecedented package of more than USD$ 100 million in rewards for information leading to the capture of several CJNG leaders. Terry Cole, the DEA's head, said drug cartels and the officials who protect them are the same thing and will be treated as such. Little response from the Mexican government has been detected, as bold statements and pressure increase.
The US suspended imports of Mexican avocados from Michoacán, by far the most important producer, as well as the activity of its sanitation inspectors, on account of security issues related to extortion. So far this year, according to the state attorney general's office, 75.8% of all extortion complaints come from the 31 municipalities that produce avocados. The President responded by sending more National Guard troops to the area, but analysts have little hope it will work this time, as it has been tried before to no avail.
In the first half of the year, Mexican exports to the US set a new record of USD$ 298.2 billion, 13% more at an annual rate. Mexico thus increased its lead as the US's prime supplier with 17.7%, followed by Canada with 11.5%, Taiwan with 7.8%, and China with 7.4%. Total bilateral trade was USD$ 493.7 billion, well above Canada with 376 and China with 184.8 billion. In June alone, such exports were USD$ 55.25 billion, 23% higher than in June 2025.
In June, Pemex exported 565,600 barrels a day, a growth of 23% year on year, the highest in eight years. Higher prices meant USD$ 1.39 billion in revenue, 61.6% more than a year before.
In the first half, foreign remittances were USD$ 30.76 billion, an annual growth of 3.1% and the second largest amount since 1995, but the lowest since 2015.