Mexico: Remittances contract for 12 consecutive months
August 1, 2013
Remittances from Mexican workers abroad totalled USD 1.9 billion in June, which was below the USD 2.1 billion observed in the same month last year. The print, which matched market expectations, represents a 7.2% contraction in annual terms. Nonetheless, it marks an improvement over the substantial 13.2% decline registered in May. This is the 12th consecutive month of declining remittances.
In the 12 months up to June, remittances totaled USD 21.3 billion, which constitutes a 9.3% decline over the same period in the previous year (May: -8.4% year-on-year). At the current level, remittances are well below the peak of USD 26.0 billion reached in the full year 2007.
Although the U.S. labor market is showing sings of a gradual recovery, LatinFocus Consensus Forecast panelists expect remittances to remain below last year's levels, reaching USD 21.7 billion in 2013. For next year, the panel sees remittances rising to USD 23.1 billion.
Author: Ricardo Aceves, Senior Economist