The specter of recession is once again looming large over the Mexican economy. It’s no longer just a matter of warnings issued by financial analysts, rating agencies, or the Bank of Mexico itself. Now, the National Institute of Statistics and Geography (INEGI) is reflecting this through one of the most important indicators for measuring the country’s economic pulse: the Timely Indicator of Private Consumption (IOCP).
This indicator shows how much Mexican families are spending on a daily basis, and includes everything from supermarket purchases to services such as internet payments.
In other words, it clearly reflects how much activity there is in the economy from within the home. That’s why it’s so important: private consumption represents nearly two-thirds of the Gross Domestic Product (GDP), which means that if families stop spending, the economy as a whole suffers.
In March 2025, the IOCP recorded an annual contraction of 2.55%, the deepest since February 2021, when, at the height of the pandemic, the decline was 5.32%.
The downward trend is not new. Since December 2024, the indicator has been in negative territory for four consecutive months: in December it fell 0.94%, in January 0.90%, and in February 2.17%. This downward trend not only reflects a slowdown in consumption but also reflects a mood of concern and uncertainty among the population.
Furthermore, March was the month in which Donald Trump’s return to the US presidency was consolidated in public perception.
With him, there are various fears, such as the tariff war and new economic threats to Mexico. The context has been sufficient for many households to contain their spending, avoid using credit cards, and even make adjustments in the face of the precarious labor market and the lack of employment in some regions.
Mexico is headed toward a recession
The INEGI data are in line with the diagnosis issued by the Mexican Institute of Finance Executives (IMEF) on April 15.
The organization believes that “Mexico’s economy is headed toward a recession.”
According to the national president of IMEF, Gabriela Gutiérrez, the recession does not depend on a single isolated data point, but rather on the conjunction of three key elements: the depth of the decline in economic activity, its duration over the months, and the spread of the negative impact in different areas, such as household consumption.
“As we are seeing through this latest survey, economic cycles are currently in contraction, and that is why we are willing to say that there may be a recessionary phase as part of the economic cycle,” she said at a press conference.
In this scenario, both the depth and duration of the slowdown are already evident, and private consumption, representing such a significant portion of GDP, confirms that the contraction is not temporary, but structural.
Source: proceso
