S&P Cuts Mexico's Outlook to Negative on Debt and Growth Concerns
Ratings agency S&P maintained Mexico's 'BBB' sovereign credit rating but cut the outlook from stable to negative. The move reflects rising public debt and slower growth than previously expected. The Mexican peso weakened against the dollar following the decision.
S&P Global Ratings kept Mexico's long-term foreign-currency credit rating at 'BBB'. However, it changed the outlook from stable to negative, signalling a possible downgrade in the coming years. The agency pointed to a rapid rise in public debt and downward revisions to its growth forecasts.
Mexico's government has lifted public investment and social spending in its latest budget, while financial support for state oil company Pemex continues to weigh on fiscal accounts. S&P now expects the debt-to-GDP ratio to climb above 50% within three years. It cut its 2026 growth forecast for Mexico to 1.4%.
Following the release, the peso closed more than 1% weaker against the dollar. The benchmark BMV stock index also slipped. A Mexican government spokesperson called the assessment unfair and said the country's core fiscal indicators remained solid. Analysts say Moody's and Fitch could take similar steps in the coming weeks.
More from South America
Trump Ally Kari Lake Nominated as US Ambassador to Jamaica
US President Donald Trump nominated former television news anchor and political ally Kari Lake as the US ambassador to Jamaica. Lake thanked Trump and described Jamaica as a country she 'knows very well'. The appointment requires Senate confirmation before taking effect.
Three dead after monster truck crashes into crowd
A monster truck crashed into a crowd at a show in Colombia, killing at least three people and injuring 38. The incident raises fresh concerns about public safety at large events.
Colombia announces record $1.4 million bounty for rebel leader blamed in bomb attack
Colombia's government announced a record $1.4 million bounty for a rebel commander known as "Marlon," blamed for orchestrating a bomb attack that killed 20 people. The extraordinary reward underscores the government's intensified campaign against armed groups destabilizing the nation.