Mexico achieved a record level of remittances in March after the US stimulus

El Economista – Mexico City

The Bank of Mexico (Bancico) reported Monday morning that in the first quarter of the year, Mexican workers displaced outside the country sent home $ 10.623 million through remittances.

In the first quarter of the year, Mexican workers displaced outside the country sent home $ 10,623 million through remittances. Monday morning reported the Bank of Mexico (Banxico).

This is the largest entry of so-called immigration dollars for a similar period, which includes an increase of 13% compared to shipments observed last year.

Information from the Central Bank of Mexico shows that only in March, remittance flows to Mexico reached an unprecedented level of $ 4.151 million, representing an annual growth of 10.4%.

With the information detailed by Banxico, it can be seen that the average remittances received in March by each of the 1.8 million households benefiting was $ 370. The average transfer was higher than the $ 320 each household received in the same period of the previous year.

Thus, the entry of so-called migradollars in March became the highest recorded in a similar month since it was recorded; It is recorded as the highest remittance income for any 30-day period in history and represents historical figures in average monthly volume and flow for the first quarter.

From Washington, Alejandro Werner, Director of the International Monetary Fund’s Western Hemisphere Department, explained that the strong flow of remittances to Mexico was driven by several factors, including a large fiscal stimulus package in the United States.High incentives for immigrants to support their families in Mexico as well as changing transfers from informal to formal channels due to border closures.

For this year, the Executive Director of the International Monetary Fund estimated that the strong trend in remittances is likely to continue, but made clear that they could slow moderately as the epidemic subsides in Mexico.

Exchange factor
From New York, Alberto Ramos, an economist at Goldman Sachs Bank in Latin America, explained that because the peso rose against the dollar by 5.7% annually, it affected the return in pesos from US money orders to homes. Of workers in Mexico.

Thus, he explained that when converting remittances into local currency, there was a decrease of 2.9% annually, which means in real terms, this discounting of inflation, also means a decrease of 7.2% compared to the March data of last year.

Goldman Sachs economist explained that the flow of remittances remains strong, indicating the effect of “the generous remittances the US government gives to families; as well as the competitive exchange rate differential and severe contraction in employment and economic activity in Mexico”.