Mexico: Trade balance returns to surplus in June
July 27, 2017
The Mexican external sector fared well in June. The trade report showed exports grew at 11.5% in annual terms, a slight deceleration from the 12.9% increase in May, with the value of Mexico’s overseas sales reaching USD 35.6 billion. Double-digit growth in both oil and non-oil exports were the main forces behind the increase, with the latter buttressed by another strong performance in the all-important manufacturing sector.
Imports grew 9.5% in June, down from a 14.7% rise in May, which was the result of a reduction in imports of capital goods. Consumer and intermediate goods imports both expanded at noteworthy rates in June, showcasing strength among households and in the manufacturing sector, respectively. Imports for June totaled USD 35.5 billion. Overall, June’s report saw a USD 0.1 billion trade surplus, which contrasts the USD 1.1 billion trade deficit in May.
The 12-month trailing trade deficit narrowed to USD 9.0 billion, slightly below May’s USD 9.6 billion shortfall and the lowest reading in three months. This month’s headline figure highlights the strong performance of overall trade in Mexico. Nevertheless, the strengthening of the Mexican peso against the U.S. dollar could put a damper on exports and render Mexican goods less competitive in overseas markets.
Author: Lindsey Ice, Economist