The Day at a Glance | March 20 2025

The Top

• In Mexico, aggregate supply and demand figures indicate that the economy is slowing down. We have revised our growth forecasts downward for 2025 and 2026.

• For the first time, ECB President Christine Lagardedetailed the potential impact of a trade war with the United States on the Eurozone´s economy and welcomed Germany’s recent spending plans.

• INEGI reported that the Timely Indicator of Economic Activity estimates that the economy grew by 0.6% y/y in January and contracted by -0.7% y/y in February, based on seasonally adjusted figures.

• In the week ending March 15^th, 2025, initial jobless claims in the U.S. stood at 223,000 (224,000 expected), slightly increasing from the previous week’s 221,000.

• The Bank of England kept interest rates at 4.5% and cautioned that rate cuts should not be taken for granted in upcoming meetings, as it faces deep uncertainty regarding the British and global economies.

• China left its benchmark interest rates unchanged for the fifth consecutive month in March, in line with market expectations.

• Brazil’s central bank raised interest rates by 100 basis points on Wednesday for the third consecutive time and signaled that it´s considering a smaller hike in its next meeting as it monitors signs of an economic slowdown.

• Oil prices remained largely unchanged on Thursday, as a larger-than-expected drop in U.S. fuel inventories and renewed tensions in the Middle East offset the strength of the dollar.

Economic Environment

In Mexico, aggregate supply and demand figures indicate that the economy is slowing down. We have revised our growth forecasts downward for 2025 and 2026. Aggregate demand, equal to aggregate supply, stagnated in 4Q24, based on seasonally adjusted and real terms data. On the supply side, GDP declined by -0.6% q/q, while imports of goods and services increased by 1.2% q/q. On the demand side, private consumption fell by -1.4% q/q, government consumption declined by -0.1% q/q, and gross fixed capital formation dropped by -1.6% q/q, while exports increased by 3.6% q/q, all based on seasonally adjusted figures for the fourth quarter. On an annual basis and based on original figures, aggregate demand expanded by 1.9% in the last quarter of 2024 (prev. 2.4%), gross fixed capital formation fell by -2.6% (prev. 1.6%), private consumption increased by 0.4% (prev. 3.0%), government consumption rose by 1.0% (prev. 1.7%), and exports saw a solid increase of 12.9% (prev. 8.9%). Overall, aggregate demand figures suggest that, at the end of last year, exports were the only growth driver, as all other components have been slowing down. Looking ahead, with tariff threats looming, exports may also record weaker growth. In this context and based on the latest information, we have lowered our GDP growth forecast from 0.9% to 0.5% for 2025 and from 1.8% to 1.5% for 2026.

Markets and Companies

The U.S. stock market is down as investors digested the Fed’s decision to keep interest rates unchanged, in line with expectations. Additionally, the Fed indicated it expects two rate cuts this year. Meanwhile, European markets were in negative territory following new central bank decisions. The Bank of England kept its rate at 4.5%, citing growing trade uncertainties caused by Trump. The Riksbank also maintained its key interest rate at 2.25%, as expected. Lastly, the People’s Bank of China decided to keep rates unchanged, leading to a negative market close.

In the commodities market, oil prices were declining, continuing the downward trend seen so far this year. In contrast, gold prices reached a new high of $3,057 per ounce, driven by economic uncertainty and tensions in the Middle East.

In fixed income, U.S. Treasury yields were falling. The 10-year bond stood at 4.19%, while the 2-year bond dropped to 3.94%.

Finally, the IPC remained virtually unchanged. Meanwhile, the exchange rate stood at 20.24, compared to 20.07 in the previous session.

Corporate News

• Nvidia announced plans to invest hundreds of billions of dollars in chip manufacturing and electronic products in the U.S. over the next four years, according to the Financial Times. The initiative will include collaborations with TSMC and Foxconn.

• Darden Restaurants reported revenues of $3.16 billion, below the expected $3.21 billion. Its high-end restaurant segment declined. Despite this, the company maintained its annual revenue forecast of $12.1 billion.

• Tesla recalled 46,096 Cybertrucks in the U.S. due to a defect in an exterior panel that could detach while in motion, posing a road hazard. The company will replace the affected assembly.