Mexico City. The tax that the United States will impose on Mexican exports will generate adverse effects that will negatively affect Mexico’s economic performance in 2025 and 2026, reported Moody’s Analytics, a division within Moody’s, which is independent of the international risk rating agency Moody’s. Ratings.
The analysis carried out by Alfredo Coutiño and Jesse Rogers, director and assistant director of Moody’s Analytics, mentions that the economy will be affected through the channels of trade, investment and remittances, while the financial sector will be shaken by aversion to risk and volatility.
“In the real sector, the Mexican economy will receive the impact of the slowdown of the US economy through lower demand for Mexican products, a second impact will come from the tariffs applied to Mexican exports, and the third will be through the negative effects on foreign direct investment, since some US companies will reconsider or even cancel their relocation plans to Mexico,” the firm mentioned.
He added that the Mexican economy will be one of the most exposed to the negative effects of US President Trump’s economic policies due to its strong trade and investment ties.
Remittances will be affected by US immigration policy through the deportations of undocumented Mexican workers and the reduction in the flow of remittances will contribute to Mexico’s economic slowdown, since it will affect the consumption of lower-income families who mostly receive remittances and have a greater propensity to consume.
“All these unfavorable effects will affect the performance of the Mexican economy, since they affect both internal and external demand,” the specialists assured.
As a result, Moody’s Analytics, whose views do not reflect those of Moody’s Ratings, lowered its gross domestic product (GDP) growth estimate to 0.6 percent in 2025 from 1.3 percent in 2024.
“The weakness of the economy will worsen in 2025 as the country’s negative trade gap will widen because US tariffs will reduce demand for Mexican exports, but also because the US economy will grow more slowly in 2025,” the specialists mentioned. .
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#Tariffs #reduce #growth #Mexican #economy #Moodys
–
* **What are the potential impacts of US tariffs on Mexico’s economy according to Moody’s Analytics?** [[1](https://en.wikipedia.org/wiki/Tariff)]
## World Today News Interview: Tariffs and the Mexican Economy
**Introduction:**
Good evening and welcome to World Today News. Tonight, we delve into the potential impact of US tariffs on Mexico’s economy. We are joined by two esteemed experts to discuss the detailed analysis released by Moody’s Analytics.
**Guests:**
* Dr. Elena Ramirez: Professor of Economics, National Autonomous University of Mexico
* Mr. Miguel Sanchez: International Trade Analyst, Center for Economic Policy Studies
**Section 1: Understanding the Impact**
**Host:** Dr. Ramirez, Moody’s Analytics paints a rather bleak picture outlining several channels through which these tariffs could impact Mexico’s economy. Could you elaborate on these channels, particularly the effects on trade, investment, and remittances?
**Dr. Ramirez:**
**(Response focusing on trade, investment, remittances, and potential for job losses, illustrating with examples and data) **
**Host:** Mr. Sanchez, Moody’s Analytics specifically mentions the vulnerability of Mexico due to its strong economic ties with the US. Can you expand on this interdependency and its implications in this context?
**Mr. Sanchez:**
**(Response discussing the depth of US-Mexico intertwined economies, mentioning specific sectors reliant on trade and investment, and possible ripple effects on supply chains) **
**Section 2: Examining the Magnitude and Scope**
**Host:** Moody’s Analytics has significantly lowered its GDP growth estimate for Mexico. Dr. Ramirez, how substantial is this predicted decline, and what are its potential ramifications for the average Mexican citizen?
**Dr. Ramirez:**
**(Response addressing the quantitative impact on GDP growth, translating it into relatable terms for the average citizen, discussing potential scenarios related to employment, inflation, and disposable income) **
**Host:** Mr. Sanchez, the article suggests that the impact on the Mexican economy will
worsen in 2025. What factors might contribute to this intensification?
**Mr. Sanchez:**
**(Response highlighting the foreseen widening trade gap, the potential slowdown of the US economy, and the possibility of further policy changes impacting trade relations) **
**Section 3: Looking Forward: Potential Mitigation Strategies**
**Host:** Despite these concerning projections, are there any potential mitigating strategies that Mexico could implement to lessen the negative impact of these tariffs?
**Dr. Ramirez:**
**(Response proposing potential strategies, such as diversification of export markets, strengthening domestic consumption, and fostering innovation in resilient sectors) **
**Host:** Mr. Sanchez, looking ahead, what role do you see international cooperation and diplomacy playing in addressing the underlying causes of these trade tensions and potentially finding solutions?
**Mr. Sanchez:**
**(Response emphasizing the importance of multilateral dialog, exploring avenues for trade agreements that benefit both countries, and promoting economic stability through regional cooperation) **
**Conclusion:**
**Host:** Thank you both for providing such insightful perspectives on this critical issue. It is clear that the potential impact of these tariffs on the Mexican economy is complex and far-reaching. As events unfold, World Today News will continue to monitor the situation and bring you the latest developments. We encourage our viewers to stay informed and engaged in this important conversation.
**End of Interview**
