BBVA Research

Exports are set to reach a record high in 2026, consolidating their role as a key driver of economic activity and supporting exchange rate stability. The country is expected to achieve three consecutive years of growth by 2027, amid declining but persistent inflation and highly uneven sectoral performance.

GDP is expected to grow by 2.9% in both 2026 and 2027. Despite the effects that El Niño is already having on growth, private investment and non-extractive sectors will continue to support economic activity. A strong rebound is expected in 2028.

El Niño 2026–27 could be exceptional, but its impact will not depend on intensity alone: local climate conditions, timing, and sectoral exposure will be key. Granular analysis can help anticipate risks, while adaptation can mitigate their effects

Argentina establishes itself as a key player in the global agricultural market, excelling in the production of soybeans, corn, wheat, and sunflower. The sector is a crucial source of foreign currency, with agricultural complexes projected to contribute 42% of the country's total exports in 2026.

Brazil’s economy is slowing: growth is expected to reach 2.1% in 2026 and 1.8% in 2027. Supply-side pressures will push inflation higher, but weak demand will likely allow for further Selic rate cuts. The post-election political landscape will shape the outlook and the balance of risks.

Tighter global financial conditions and persistent inflation pressures require a prudent policy mix. We expect monetary policy to stay restrictive, with historically high real rates and continued macroprudential measures, while fiscal and credit support is likely to be selective.

Global defense demand is structural, driven by tensions, rising budgets and new warfare. Europe faces gaps in air defense, drones, long-range fires and ammunition, while Türkiye can complement it through co-production and supply-chain partnerships. Future competitiveness will depend on AI, autonomy, cyber and space.

Colombia’s economy will grow 2.6% in 2026, ease to 2.3% in 2027, and rebound to 3.1% in 2028. The 2027 slowdown will be temporary as growth shifts from public to private-sector support, which will strengthen in 2028. Fiscal imbalances and inflation remain the key challenges ahead.

The Turkish economy grew by 2.3% y/y in 2Q26, below both our expectation (3%) and market consensus (2.9%), bringing growth in 1H26 to 2.5% y/y. Assuming a prudent policy mix going forward and no further escalation in geopolitical tensions, we maintain our 3.0% GDP growth forecast for 2026 with limited downside risks now.

Mexico's current account recorded a surplus of USD 8.9 billion in 2Q26, driven by a record high in the non-oil merchandise balance. In contrast, Net Foreign Direct Investment (FDI) showed an annual decrease of 11.7% during the first half of 2026.