EL PASO, Texas (Border Report) – Mexico’s recently approved judicial reform and its president-elect’s declared intent to seek closer relations with China and Russia are bringing economic uncertainty to America’s top trade partner.
The consensus forecast for gross domestic product has shrunk to 1.5 percent, consumption growth has been axed to 1.9 percent and total investment growth is down to 2.8 percent, according to the University of Texas at El Paso’s Border Modeling Project forecast released on Monday.
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Further, the inflation forecast for this quarter is now 4.7 percent and the value of the peso is expected to drop to 20.46 per U.S. dollar, the research shows.
“Economic uncertainty has rarely reached the levels currently observed in Mexico. Judicial branch independence may be on the verge of at least partially disappearing,” economic researchers Thomas M. Fullerton, Jr., and Steven L. Fullerton of UTEP wrote. “Against that backdrop, the consensus outlook for both 2024 and 2025 has turned decidedly more pessimistic.”