Mexico Trade May 2018


Mexico: Merchandise trade deficit widens in May

June 27, 2018

Merchandise trade recorded a USD 1.6 billion deficit in May, widening notably from the USD 1.2 billion deficit registered in May 2017 and also the USD 289 million deficit registered in April. The result disappointed market analysts who had expected a smaller USD 900 million deficit. Despite the wider trade deficit, export growth was relatively solid, expanding 10.9% over the same month a year prior in May (April: +17.0% year-on-year). The softer exports print was the result of notably weaker manufacturing exports (May: +7.8% yoy; April: +14.9% yoy), held back by tepid automotive exports, which eased out of double-digit growth (May: +5.5% yoy; April: +19.9% yoy).

Meanwhile, import growth also softened in May, decelerating to 11.5% in annual terms from April’s almost seven-year high of 21.4%. Among non-oil goods, the moderation in import growth was broad-based in May. Non-oil consumer imports—a proxy for domestic private consumption—came to a near halt. Non-oil intermediate imports—which are closely linked with manufacturing activity—also slowed considerably. Similarly, imports of capital goods—a proxy for investment—weakened in May.

The 12-month trailing trade deficit increased to USD 11.5 billion in May from USD 11.2 billion in April, considerably larger than the USD 9.7 billion deficit recorded in May 2017.

Panelists surveyed for this month’s LatinFocus report expect exports to reach USD 437 billion in 2018, which would represent a 6.8% expansion compared to the previous year. Meanwhile, imports are expected to grow 6.5% and reach USD 448 billion. For 2019, the panel expects exports to expand 5.4% and imports to expand 5.5%.


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Mexico Trade Chart

Mexico Trade12m May 2018 0

Note: 12-month sum of trade balance in USD billion and annual variation of the 12-month sum of exports and imports in %.
Source: Mexico National Statistics Institute (INEGI)

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