Mexico sees stable finances, rules out new taxes for 2026, finance ministry says

By Ana Isabel Martinez, Adriana Barrera and Brendan O'Boyle

MEXICO CITY, July 30 (Reuters) - Mexico's finance ministry estimated on Wednesday that the country's economy would grow between 1.5% and 2.3% this year despite ongoing trade uncertainty that has left Latin America's second-largest economy in a vulnerable position.

The ministry said it has ruled out raising or implementing new taxes next year.

"In the first half of the year, public finances remained stable, with fiscal balances in line with the targets approved by Congress and consistent with the Mexican government's commitment to development and social justice," the ministry said in a report.

The report was issued hours after Mexico's national statistics agency disclosed that the country's economy grew tepidly for the second consecutive quarter in April through June, according to a preliminary estimate.

The quarter's 0.7% expansion is enough to avoid a recession but underscores the challenges facing Mexico's economy, punctuated by the uncertainty caused by U.S. President Donald Trump's trade war.

Analysts polled by the central bank in June forecast 2025 growth at a meager 0.2%, while the central bank's own forecast sits at just 0.1%.

The finance ministry has consistently offered rosier analyses than the central bank or private sector analysts, a trend that continued on Wednesday.

"It seems difficult" that the economy will either contract or grow as little as the current consensus of financial analysts, Rodrigo Mariscal, head of the finance ministry's economic planning unit, said during a presentation of the report.

In the report, the ministry noted that at the end of June, Mexico's public debt stood at 49.5% of GDP compared to 51.3% at the end of 2024. The ministry said the deficit forecast for the end of the year is in the range of 3.9%-4% of GDP, in line with its preliminary estimate.

It also maintained the inflation target of 3.5% at the end of 2025.