Mexico Manufacturing Activity Improves

The S&P Global Mexico Manufacturing PMI rose to 50.3 in September 2026 from 49.8 in the prior month, signaling a fractional improvement in the health of the sector. The decline in output extended the current sequence of contractions to 27 months, albeit at a softer pace then the prior month. New business volumes continued to rise, with firms citing resilient demand for certain products. However, export sales were a further source of weakness, having declined for a third consecutive month amid reports of softer demand from Europe and the US. Employment fell again. Outstanding business rose for the first time in eight months, with backlogs accumulating at the strongest rate since the start of the year. Inventories of finished goods declined as purchasing activity declined for a second month. Positive sentiment reached its highest level since November 2025, as firms expect greater sales, investment and export orders. Still, it remained below its historical average.

The S&P Global Mexico Manufacturing PMI fell to 49.8 in August 2026 from 51.3 in the prior month, signaling a renewed deterioration in operating conditions. A reduction in factory output weighed most, marking the steepest contraction in eight months as firms reported subdued market conditions, material shortages and shipping delays linked to the conflict in the Middle East. Demand also weakened, as new order growth slowed from recent peaks, reflecting a fall in new export orders at the quickest pace in 2026 so far. As a response, manufacturers trimmed their purchasing activity, marking the first reduction in three months. Stocks of purchases also fell, while fineshed goods inventories rose slitghly. In turn, cost pressures continued to moderate, as the input cost inflation slipped to a five-month low, although still elevated amid US tariff and Middle East uncertainty. Looking ahead, sentiment turned pessimistic, with firms citing concerns over general market uncertainty.

The S&P Global Mexico Manufacturing PMI held at 51.3 in July 2026, signalling a second consecutive monthly improvement in operating conditions. New orders rose at the fastest pace since November 2023, driven by stronger domestic demand, while export orders slipped back into contraction. Factory output remained in decline, extending a downturn that began two years ago, amid weakness in the automotive and construction sectors and plant maintenance. Finished goods inventories fell, while pre-production stocks declined due to supplier delivery delays. Vendor performance deteriorated further amid shipping bottlenecks, supplier shortages and the Middle East conflict, prompting firms to raise input purchases at the fastest pace in nearly two-and-a-half years. Input cost inflation remained elevated, driven by higher fuel, material and transport costs and tariffs. Business confidence stayed subdued amid concerns over cash flow, insecurity, international competition and geopolitical risks.