Economic growth in Latin America & the Caribbean is expected to moderate from 2.3% in 2025 to 2.2% in 2026, before improving gradually to 2.5% in 2027 and 2.6% in 2028. This according to the Regional Outlook of the World Bank Global Economic Prospects 🌎, published mid-June.
Higher and more volatile global energy prices, weaker global growth, stricter monetary conditions, and still-weak domestic demand are weighing on the regional outlook. Investment is expected to play a central role in the subsequent recovery.
Growth in Largest Latin American Markets
Brazil’s 🇧🇷 economy is projected to slow from 2.3% in 2025 to 1.9% in 2026 as consumption growth weakens, before picking up to 2.0% in 2027, as continued disinflation creates room for monetary easing.
Mexico 🇲🇽 is expected to be only moderately affected by the energy price shock, given its broadly balanced energy trade position and fiscal measures aimed at limiting the impact. Its outlook will be driven primarily by domestic demand and external trade dynamics, especially those linked to the United States and the USMCA review. Growth is forecast to rise to 1.3% in 2026 and 1.7% in 2027. From 0.6% in 2025.
Argentina’s 🇦🇷 growth is forecast to remain comparatively robust and broadly stable at 3.6% during 2026–28, supported by exports but held back domestically by tight monetary and fiscal policies. Growth in 2025 was 4.4%.
In Colombia 🇨🇴 growth is expected to ease from 2.6 in 2025. to 2.3% in 2026, with higher oil prices supporting incomes while persistent inflationary pressures delay policy rate cuts. Growth for 2027 is forecasted at 2.4%.
Panama Remains among LATAM Growth Leaders with 3.9%
Panama 🇵🇦 remains among LATAM Growth Leaders with 3.9% in 2026 and 4.1 in 2027 (4.4 in 2025), the 2nd highest growth in Latin America (see chart below). It is only preceded by No. 1 Paraguay 🇵🇾 with 4.4% in 2026 and 4.2% in 2027.
World Bank Regional Economic Outlook Latin America & Caribbean, June 2026
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