The Mexican GDP contracted by 0.8% from the pervious quarter in the first quarter of 2026, erasing the 0.9% expansion from the final quarter of last year to overshoot the expectations that the economy would contract 0.5%. The contraction was in line with projections by the Bank of Mexico, that resumed their interest rate cutting cycle despite the aggressive rebound in inflation from March. Output contracted 1.4% for primary activities despite the surge in silver and energy prices. Meanwhile, production fell 1.1% for the secondary sector as manufacturers continued to adjust to tariffs from the US, cutting a key source of demand for auto producers. In turn, services output fell by 0.6%. The GDP inched higher by 0.1% from the previous year.