Mexico’s seasonally adjusted unemployment rate fell to 2.9% in July from 3.1% in June, beating the 3% forecast, data from the National Institute of Statistics and Geography (INEGI) showed. The labor force participation rate also increased, while informal employment remained elevated at about 54%. Services, particularly hospitality, trade and business services, drove job gains, while manufacturing employment held steady despite weaker external demand. The resilient labor market may continue supporting domestic consumption and gives the Bank of Mexico room to keep its benchmark rate at 10.5% as it balances sticky inflation against slowing growth. Markets showed little immediate reaction, with the Mexican peso stable against the US dollar. Analysts remain cautious because industrial production and retail sales have been mixed, and future hiring may depend on US trade policy, global export demand, infrastructure spending and nearshoring investment.