Sergio Kurczyn, Director of Economic Studies at Banamex, stated in a conference: "There are no conditions for them to meet their goal." For the analyst, inflation has already become a structural problem related to credibility, since the 3% target was set, they have not been able to achieve it sustainably. Banxico sees more pressures on underlying inflation but defends the rate-cutting cycle: "It is consistent." For the coming year, analysts estimate that inflationary challenges will be related to IEPS, tariffs on China, and the World Cup, all factors that will pressure the underlying component, which they estimate will reach 4.5% in the first quarter of the year. In that scenario, Banamex analysts expect the central bank to pause in the first part of the year to see the impact of all these factors, following a rate cut they still expect by the end of the year by 25 basis points. "In that sense, analysts are convinced that the central bank's real target is 4%, which would be consistent with current monetary policy movements," explained Iván Arias in turn. Despite assuring that Banxico is facing a credibility problem, both analysts emphasized that it only affects the forecasting part, as an institution they consider it to remain solid. In that sense, they pointed out that it would help if they made transparent the models they use for their forecasts, since central bank officials defend that the difference between what the markets see and what they see lies in the type of models. Edgar Amador, Secretary of the Treasury. Challenges of fiscal consolidation. Similarly, analysts questioned the government's fiscal deficit targets. Despite Banxico's defense of its inflation target, Banamex analysts maintain that it will not be in 2026 when they achieve the 3% goal and affirmed that the central institution is indeed going through a credibility problem. According to the estimates of the financial institution, by the end of next year, the annual general inflation rate will be at 4.3%, which means they expect it to be even above the central target range. He explained that on the revenue side, despite a tax improvement, it barely compensates for the drop observed in oil revenues; there is also no robust economic growth; and there are increasing pressures on spending, both social and pensions. The financial institution estimates that the economy will perform better next year due to better dynamism in investment and consumption; however, it warns that it is still a challenging scenario, both due to the tariff uncertainty with the United States and the local one, related to reforms to the country's legal framework. "2025 is a lost year for growth," warns Franklin Templeton. The analyst described the judicial reform as "extravagant," highlighting that the election of the entire Judicial Power, as Mexico is now implementing, is not seen anywhere else in the world, and he assured that it has had a very poor, disorderly implementation. The law of amparo is also added, which he explained reduces the capabilities of the private sector by increasing legal uncertainty. Kurczyn warned that the trend points to an increase in debt to GDP of 60%, "with impressive deficits," so he pointed out that if the objective is to consolidate the debt, it will not be positive if it is at those levels. "The debt is not going to stabilize, there are no conditions," he assured. "It is another stripe on the tiger, of a tiger that we did not like."
