Mexico’s budgetary pressures will keep growing

Significance The budget deficit is increasing markedly and will probably top 6% of GDP in 2024 -- the highest level since the late 1980s -- while economic growth remains in the 2-3% range. Impacts High real interest rates and continued inflows of dollars through remittances and foreign portfolio investments will keep the peso strong. Fiscal expansion will increase the external deficits but the current account imbalance will remain moderate, at about 1% of GDP this year. The four-month interregnum after the election will offer the new government time to devise its fiscal plans for 2025.