*Mexico’s central bank (Banxico) has released its quarterly report for the second quarter of 2025 in which it revised up its 2025 GDP growth forecast to 0.6%, up from 0.1% in its previous quarterly report, released in May. It also revised the 2026 GDP growth forecast to 1.1%, up from 0.9%. In its report Banxico said that despite the impact of various US tariffs and “persistent uncertainty” associated with the direction of US economic policy, Mexico’s had economic activity expanded “more than expected”. Mexico’s GDP expanded 0.6% in quarterly terms in the second quarter of 2025, and was up 1.2% year-on-year. Yet the report states that economic growth remains sluggish, while inflation rose from 3.72% to 4.22% between the first and second quarters of 2025 although it notes that this has since dropped to 3.49% in the first half of August. However, Banxico, which last month lowered its benchmark interest rate by 25 basis points to 7.75%, said that it stood by its estimates that headline inflation would converge to its 3% target in the third quarter of 2026.
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