KBRA affirms Mexico's BBB rating with a stable outlook
Short-term ratings stay at K2, and the Finance Ministry says eight agencies keep the country at investment grade.
Kroll Bond Rating Agency (KBRA) has affirmed Mexico's long-term sovereign rating at BBB, in both foreign and local currency, and kept the outlook stable, according to the Finance Ministry's Release No. 91 on Friday. Short-term ratings stay at K2.
KBRA's surveillance report, published the same day, affirms the ratings and says the long-term ones carry a stable outlook. A sovereign rating is an agency's opinion on whether a government will be able to repay its debt; the outlook signals where it could move next. "Stable" means the agency does not expect a change soon.
The ministry, known as Hacienda, adds that eight agencies rate Mexico's sovereign debt and that the country keeps investment grade with all of them. It credits KBRA with recognizing three things:
- Macroeconomic and fiscal management.
- A better public debt structure.
- Progress in tax collection.
The figures the ministry offers to back that assessment:
| Indicator | Before | After |
|---|---|---|
| Public sector borrowing requirements, % of GDP | 5.8 (2024) | 4.3 (2025) |
| Tax revenue, % of GDP | 8.0 (2012) | 15.2 (2025) |
| Exports to the United States entering under USMCA, % | 45 (January 2025) | 87 (June 2026) |
Borrowing requirements measure how much the public sector needs to finance in a year. The government projects they will fall to 4.1% of GDP in 2026 and 3.9% in 2027.
KBRA estimates the economy will grow 1.5% in 2026 and 1.8% in 2027, converging gradually toward 2% over the medium term. In the second quarter of 2026, 85% of federal debt was in local currency and 82% in fixed-rate instruments maturing in a year or more.
To absorb external shocks, the release counts international reserves of about $257 billion, an International Monetary Fund Flexible Credit Line of roughly $24 billion and another $12 billion in currency swap arrangements with U.S. financial authorities. Bank capitalization stood at 20.8% in August 2026.
Investment grade with a stable outlook influences what it costs the government and Mexican companies to borrow, and it serves as a benchmark for institutional investors.
KBRA's own report sets limits: still-low tax collection, high interest costs, weak growth and institutional challenges. The public summary of the document names the financial trouble at the state oil company Pemex as the main credit challenge, although the ministry stresses that government support eased its liquidity pressures.
