Fitch Ratings has predicted a technical recession for Mexico as a result of the tariffs imposed by US President Donald Trump , and has also lowered its growth projection for the country in 2025.
“We anticipate a recession in Mexico, where we have cut our 2025 forecast by 1.1 percentage points to 0 percent,” the institution reported in its World Economic Outlook – March 2025 report.
The rating agency also lowered its growth forecast for 2026 to 0.8% , a nine percentage point decrease from its previous estimate.
In his analysis, he noted that the new US administration has launched a global trade war that will reduce growth in the US and globally, boost inflation in the US, and delay rate cuts by the Federal Reserve (Fed).
“We have cut both our 2025 US growth forecast to 1.7% from 2.1% in the December 2024 World Economic Outlook and our 2026 forecast to 1.7% to 1.5%. These rates are well below trend and below the annual growth of nearly 3% in 2023 and 2024,” he warned.
Fitch Ratings estimates that the impact will be felt globally, forecasting that global growth will slow to 2.3% in 2025. It also indicated that growth will remain weak at 2.2% in 2026.
“This is a downward revision of 0.3 percentage points and reflects widespread declines in developed and emerging economies. Growth will remain weak, at 2.2% in 2026,” he stated.
He noted that the U.S. effective tariff rate (ETR) has already risen to 8.5% from 2.3% in 2024 and warned that further increases are likely.
“Our latest economic forecasts assume a 15% ETR will be imposed on Europe, Canada, Mexico, and other countries in 2025, and 35% on China. This will bring the U.S. ETR to 18% this year before moderating to 16% next year as Canada and Mexico’s ETRs fall to 10%. This would be the highest rate in 90 years,” he stressed.
He noted that there is great uncertainty about how far the United States will go and noted that there are risks of a “major tariff shock,” even due to an escalation of the global trade war.
“Tariff increases will result in higher consumer prices in the United States, reduce real wages, and increase business costs, while increased political uncertainty will hurt business investment. Retaliation will hurt U.S. exporters. Global export-oriented manufacturers in East Asia and Europe will also be affected,” he noted.
Fitch Ratings’ forecasts are in line with those of the Organization for Economic Cooperation and Development (OECD) , which estimated that the 25% tariff levied on various Mexican products that Donald Trump is seeking to impose , and which was suspended for goods covered by the United States-Mexico-Canada Agreement (USMCA) until April 2, would cause the country’s Gross Domestic Product (GDP) to contract by 1.3% in 2025.
In its OECD Economic Outlook, March 2025 Interim Report , the organization noted that if the United States’ tariff policy is maintained, this contraction, projected at 0.6% for 2026, would cause an economic recession for Mexico, being the only country with negative figures in this regard.
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