The financial market landscape in Mexico, according to various economic experts and analysts, has experienced improved growth projections for the country’s economy in 2024. Gross Domestic Product (GDP) is estimated to expand by 2.18%.
Analysts expect the Mexican economy, which had been growing at over 3% in 2023, to continue at a rate of over 2% in 2024, in line with their November forecasts.
Since the beginning of 2023, when a growth of 0.92% was announced, the forecasts of economists consulted by the Banco de México (Banxico) have experienced a steady increase. This phenomenon is repeated in the economic projections of other international organisations, such as ECLAC, which has improved its estimates by 1.4 percentage points to 2.9%, and the OECD, which estimates an increase of 3.4% at the end of the year, 0.8% higher than previous forecasts.
Stable economic dynamics
At the same time, inflation forecasts have remained stable since the previous month, with the index projected to close 2023 at 4.57% year-on-year. At the same time, the inflation expectation for the next twelve months has been adjusted downward to 4.03% compared to the previously estimated 4.12%.
In the 2024 horizon, economic variations show stability, projecting an inflation figure of 4%. At the end of October, inflation in Mexico decreased to 4.26%, marking nine consecutive months of declines.
This landscape, characterised by controlled inflation and changing perceptions about the business climate, suggests an economic dynamic in Mexico that, while maintaining its stability, also reflects a sensitivity to external conditions and market expectations.
Good investment prospects and opportunities
The percentages of analysts who believe that it is not the best time to invest or who express uncertainty about the current situation have decreased compared to the previous survey. On the other hand, the proportion of experts saying that it is a good time to invest has increased compared to the previous month, emerging as the predominant view this time around.
For her part, the governor of the Banco de México (Banxico), Victoria Rodríguez Ceja, has stated that the Mexican economy will experience growth of up to 3.7% in 2024. This optimistic projection is attributed to the fiscal stance adopted by the government of Andrés Manuel López Obrador and a slowdown in productive activity in the United States.
The governor has also pointed out that the prospect of a higher level of activity at the end of 2023 provides a solid basis for growth, influencing the adjustment of the projections for 2024. Compared to 2023, Gross Domestic Product (GDP) growth is expected to be between 3.1% and 3.5%, with a central estimate of 3.3%, exceeding the 3% forecast set in September of the year that ended.
Awaiting the signing of the EU-Mexico agreements
Negotiations to modernise the Global Agreement between the European Union (EU) and Mexico began in June 2016, and a political agreement was reached on 21 April 2018. At this stage, the agreement requires the approval of both the European Council and the Parliament before it can enter into effect.
At the last EU-Mercosur summit in July, the processes for signing agreements between the EU and Mexico were practically closed as part of the efforts to modernise and strengthen trade relations between the two regions.
These growth expectations may be fundamental for the consolidation of Mexico as an attractive destination for foreign investment. The positive economic outlook, with GDP growth estimated at 2.18% for 2024, coupled with controlled inflation and a favourable business climate, creates a favourable environment for companies looking to expand into new markets.
The possible signing of the EU-Mexico agreement is presented as an additional factor that will boost economic growth and investment opportunities. This agreement will strengthen commercial ties between the two regions, opening new doors for the internationalisation of companies and the export of products.
Remember that, to help you in any matter relating to the internationalisation and expansion of your company, at Banco Sabadell we have a team of specialists at your disposal to help you resolve your doubts. And at Sabadell Go Export, our centre for internationalisation resources, you can find the information you need and the best partners for the whole process of internationalisation.
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