Mexico: Trade balance deficit smaller than expected
November 27, 2013
The trade balance recorded a USD 129 million deficit in October, which followed a surprising USD 659 million surplus in the previous month. Despite the monthly swing, the October reading came in below both the USD 1.6 billion shortfall observed in the same month last year and market expectations of a USD 770 million deficit.
October's trade shortfall was the result of a 3.4% growth in exports over the same month last year (September: +7.2% year-on-year). A solid increase in overseas sales of manufacturing goods offset slower shipments of petroleum products. Meanwhile, imports contracted 1.0% year-on-year in October, contrasting the 5.7% expansion observed in September. The reading suggests that domestic demand still lacks momentum.
LatinFocus Consensus Forecast panelists expect exports to increase 3.6% this year, while imports are expected to rise a stronger 5.0%. For 2014, the panel expects exports and imports to accelerate, growing 7.9% and 8.4% respectively.
Author: Ricardo Aceves, Senior Economist