The International Monetary Fund (IMF) published its new outlook for global economic growth on Tuesday , where it presented a drop for Mexico to 2.2% in 2024, compared to 2.4% in its previous estimate in April.

The multilateral organization’s report cited that this variation is due to a moderation in demand as the main factor. Furthermore, it reflects a challenging economic environment , where internal and external conditions are influencing growth dynamics.

As for 2025 , the IMF projection for Mexico rose from 1.4% in April to 1.6% in July.

With respect to Latin America and the Caribbean , growth has been revised downwards for 2024 due to climatic factors in some countries such as Brazil, with a growth projection in the region of 1.9%, one tenth below April estimates , and growth of 2.7% is expected by 2025.

At a global level, the IMF report projected growth of 3.2% for this year and adjusted upwards its estimate for 2025, placing it at 3.3 percent. He also noted that global activity and international trade have strengthened at the beginning of the year, with exports from Asia, especially in the technology sector, driving global trade.

However, there are several dynamics that complicate the global economic outlook:

• Persistent inflation: Service price inflation continues to weigh on disinflation, complicating the normalization of monetary policy and increasing the risk of higher inflation. This leads to a picture of higher interest rates for longer.
• Trade tensions: Rising trade tensions and political uncertainty are raising economic risks, affecting both advanced and emerging economies.
• Variations in regional growth: While some economies such as China and India show signs of robust growth, others such as the United States and Japan face significant challenges.

In the United States , the sharper-than-expected slowdown is due to a moderation in consumption and a negative contribution from net trade. While, in Japan , temporary disruptions in supplies have affected growth.

• Commodity prices: IMF projections also indicate a 5% increase in non-fuel commodity prices by 2024, while energy commodity prices are expected to decline by about 4.6%, less than projected previously in April.

Overall, risks to the outlook are balanced. However, some near-term risks have gained importance, particularly in the supply chain .

Rising trade and geopolitical tensions may exacerbate these risks, increasing the cost of imported goods and negatively affecting the global supply chain.

Likewise, persistent inflation in the services sector  presents a significant challenge. The high proportion of labor in costs in this sector, together with limited productivity, makes price moderation difficult.

In that sense, although the global economic growth forecast remains stable, internal economic conditions and variations in monetary and fiscal policies at a global level are significantly influencing the growth prospects of each country.

For Mexico, the downward adjustments in the projections reflect these challenges, while a gradual recovery is expected in the next year.

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