SAN DIEGO (Border Report) — Retail sales in Mexico dropped by more than 9 percent in July when compared to the same time period last year, according to Mexico’s Institute of Statistics and Geography.
The drop is the most significant so far in 2025, a trend that’s generating concerns because retail sales are one of the biggest drivers for the Mexican economy.
Overall wages also dropped by 2.3 percent compared to the previous month.
The sale of farm equipment and transport trucks fell by more than 12 percent, while textiles and shoe manufacturing went down by 2.2 percent.
The biggest drop in overall business was reported in Mexico City and the state of Baja California Sur, by 10.9 and 9.2 respectively.
On a national level, supply of goods and services were down in July by almost 9 percent.
In contrast, small businesses reported short gains in sales and income by 2.3 percent while online commerce saw a whopping 50 percent increase from the previous year as Mexican consumers continue to turn to digital shopping more and more.
According to the Baker Institute For Public Policy, based at Rice University in Texas, Mexico is facing ongoing economic challenges for the remainder of 2025 and throughout 2026.
The Baker Institute says the Trump administration’s new trade policies, especially the periodic tariff threats and the resulting uncertainty, “have caused detrimental effects on Mexico’s interests and will likely continue to do so. Second, particularly in light of the United States’ recent trade actions, Mexico should be planning for new stipulations during the mandatory 2026 review of the U.S.-Mexico-Canada Agreement (USMCA).”
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