Mexico | GDP grew 0.2% in 1Q25 with stagnation in services and decline in industry

Summary

The tertiary sector registered zero growth compared to the previous quarter (0.0% QoQ), while the industry contracted (-)0.3% QoQ during the same period; only the primary sector posted positive growth, with 8.1% QoQ (following an 8.5% decline in 4Q24).

Key points

• Key points:
• The timely GDP data confirms the continued slow economic growth, given the highly uncertain environment triggered by changes in US trade policy.
• By component, the highest weakness is in the industrial sector, which, while reporting a rebound in February due to increased manufacturing orders (prior to the implementation of tariffs), was not enough to offset the consecutive year-on-year declines recorded since September 2024.
• Regarding the tertiary sector, the preliminary INEGI figure represents the lowest growth in the segment since March 2021 (QoQ) and reflects the moderation in spending on goods and services by households and businesses.
• We believe the new US trade policy represents severe impacts on supply chains worldwide, and especially those in Mexico; regarding the tertiary sector, we estimate it will continue to show signs of moderation going forward in a context of high uncertainty, affecting consumer and business confidence.

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