Mexican economy seen growing up to 3.5% in 2024, draft budget shows

By Thomson Reuters Mar 27, 2024 | 1:55 PM

MEXICO CITY (Reuters) – Mexico’s economy is seen growing between 2.5% and 3.5% this year and then expanding 2.0% to 3.0% in 2025, a draft budget from the country’s finance ministry showed on Wednesday.

Inflation in Latin America’s second-biggest economy is expected to tick down to 3.8% this year, according to the draft, essentially meeting the central bank’s target of 3%, plus or minus one percentage point. The expected 2024 inflation rate would also signal a slowdown from the 4.40% annualized growth rate in consumer prices in February.

For 2025, the draft budget predicts that inflation will further ease to 3.3%.

The document, which is used by lawmakers to plan future spending, also sees Mexico’s peso trading at 17.8 pesos per dollar this year, and slightly weakening to 18.0 versus the U.S. currency next year.

Average crude oil production this year is forecast at 1.85 million barrels per day (bpd), rising slightly to 1.86 million bpd in 2025.

While the draft budget said the estimates refer to crude volumes, the government generally combines crude with condensate liquids in its figures.

Official data shows that state-owned oil company Pemex pumped an average of 1.55 million bpd of crude in February, its lowest level since 1979.

Pemex’s oil output, the sales of which are a major contributor to public finances, has been on a steady decline from its peak of 3.4 million bpd two decades ago.

Meanwhile, crude exports are expected to reach 967,600 bpd this year and drop to 958,400 bpd next year.

(Reporting by Valentine Hilaire, Noe Torres and Adriana Barrera; Editing by Anthony Esposito, David Alire Garcia and Paul Simao)