Mexico: Merchandise trade records stronger-than-expected surplus in March
April 27, 2018
The merchandise trade surplus widened to USD 1.9 billion in March from USD 1.1 billion in February, underpinned by a pick-up in manufacturing exports and solid global trade dynamics. March’s trade performance surprised market analysts who had penciled in a much weaker USD 326 million surplus. The gains add to a string of data releases that suggest the economy gained traction in Q1, buttressed by robust growth in the United States and gradually waning domestic headwinds.
External demand remained robust in March, with export growth expanding 10.0% in annual terms, easing slightly from the 12.3% increase recorded in February. Exports in March totaled USD 39.7 billion. The healthy print came on the back of a solid performance in auto exports, which eased slightly from February but still grew a robust 16.8% in March amid healthy U.S. production levels (February: +17.9% year-on-year). Overall, manufacturing exports recorded a 7.5% expansion in March (February: +10.5% yoy).
Meanwhile, import growth was weak across the board in March. Non-oil consumer imports—a proxy for domestic private consumption—moderated sizably. Non-oil intermediate imports—which are closely linked with manufacturing activity—eased from double-digit growth. Similarly, capital imports, a proxy for investment, tapered from a 20.1% increase in February to a meager 3.4% expansion to March. Overall import growth ebbed to 4.5% annually in March from 11.7% in February, totaling USD 37.7 billion.
The 12-month trailing trade deficit narrowed to USD 9.5 billion in March from USD 11.5 billion in February, below the USD 11.9 billion deficit recorded in March 2017.