Mexico: Weak global demand dents Mexico's exports while oil exports continue to underperform
September 25, 2015
In August, Mexico’s trade deficit totaled USD 2.8 billion, which was worse than the USD 1.8 billion shortfall the markets had expected. August’s trade deficit also came in below the USD 1.2 billion deficit recorded in August 2014 and marked the poorest reading in seven months. Due to the deeper-than-expected deficit in August, the 12-month moving sum of the trade deficit reached a multiyear low of USD 9.5 billion.
Looking at the details, exports were down 6.8% annually in August and reached USD 31.0 billion. August’s contraction followed the 2.6% decrease tallied in July. Weaker global demand for manufactured exports as well as persistent low oil sales abroad were the main drivers behind August’s contraction. Oil exports in August declined 48.3% annually, while manufactured overseas sales fell 2.2%--in particularly car exports.
On the other side of the balance, imports totaled USD 33.8 billion in August, which was 1.9% below the USD 34.5 billion observed in the same month last year. August’s decrease contrasted the 1.1% increase registered in July.
Author: Ricardo Aceves, Senior Economist