The projections of Intercam Grupo Financiero indicate that during 2023 the Gross Domestic Product (GDP) will have a growth of 0.5%, with inflation of 5.6% and a funding rate of 11.25% with an exchange rate of 20.80 pesos per dollar.

Regarding the Gross Domestic Product, next year the global slowdown is expected to continue deepening, anticipating a recession in the United States in mid-2023, as a consequence of the effects of high interest rates globally. 

This situation would generate important implications for growth in Mexico, which could begin to see a much more moderate rate of expansion at the level of exports, as demand and the industrial sector in the United States cool off.

Expectations of high inflation and interest rates will gradually impact the recovery rates of the domestic market, particularly consumption, so our main growth engine could also lose strength.

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Another decisive factor to maintain growth will be investment, which could be boosted by foreign direct investment in a context of reconfiguration of productive chains (nearshoring) that has already begun in 2022. 

However, it is not entirely clear that the phenomenon is enough to trigger a new investment cycle in Mexico, since high interest rates and tight financial conditions at a global level could limit the financing capacity of new investments and could play against a greater investment.

Specialists believe that inflation will remain above Banxico's target range throughout the year; following a slow downward trajectory to conclude at a level of 5.6%. On the other hand, the upward risks for inflation remain on the core side, specifically due to higher prices in services and merchandise through the importation of inputs and accompanied by an exchange depreciation.

Analysts also consider that there is little room for Banco de México (Banxico) to decouple from the US Federal Reserve (FED) without observing a deterioration in foreign portfolio flows, which would have implications for the exchange rate. For this reason, they expect the FED to keep its rate unchanged for all of 2023 at 5.25 percent, as a preventive measure against new outbreaks of inflation.

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Upward pressures on the exchange rate could continue to be limited, so they project a slight depreciation for the exchange rate towards 20.8 pesos per dollar, considering a dollar that will remain relatively strong globally, with inflation slowly falling in the United States and forces the Fed to keep interest rates high for longer.

For now, a moderate recession is expected in the United States, as the economy is still in good shape and it is estimated that inflation will eventually drop to the Fed's target, without raising rates much beyond 5 to 5.25%.

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