Mexico lowers 2025 growth forecast on trade war fears

Workers work at steel company in Monterrey, Nuevo Leon, Mexico, on February 11, 2025.  (Photo by Julio Cesar AGUILAR / AFP)

MEXICO CITY, Mexico — Mexico’s government on Tuesday sharply lowered its economic growth forecast for 2025, citing uncertainty over American tariffs set to be imposed by Donald Trump.

The US president is expected to reveal Wednesday the shape of sweeping tariffs against all countries that tax American imports — adding to his new levies on steel and aluminum and just before additional ones hit cars entering the country.

READ: Trump set to unleash ‘Liberation Day’ tariffs

More than 80 percent of Mexican imports go to its northern neighbor, making the country America’s biggest trading partner.

Many factories south of the border assemble vehicles for foreign firms like Ford, General Motors, BMW, Volkswagen or Toyota.

The Mexican finance ministry said that it was lowering its growth forecast to a range of 1.5 to 2.3 percent — down from the 2.0 to 3.0 percent hoped for last November.

It pointed to “an uncertain external environment given global trade tensions and geopolitical conflicts.”

Mexico’s central bank had earlier also revised its forecast downwards, halving it to 0.6 percent growth over “uncertainty” emanating from Washington.

President Claudia Sheinbaum said Tuesday that she did not believe in an “eye for an eye” approach to retaliating to potential US tariffs.