Remittance reception stumbles in July: Mexico receives 10% less money from abroad compared to the previous month

The arrival of remittances to Mexico is slowing down. The receipt of money from abroad amounted to 5.614 billion dollars, a 10% drop compared to the previous month, when more than 6.2 billion dollars were received. The Bank of Mexico has announced that this amount represents a 1% drop compared to July of last year, when remittances amounted to 5.668 billion dollars. “In the seventh month of 2024, income from remittances from abroad was 5.614 billion dollars, which were derived from 14 million transactions, with an average remittance of 402 dollars,” the institution indicates in its report.

In total, Mexico totaled 36.94 billion dollars from January to July of this year, an increase of 2.9% compared to the same period of the previous year. More than 96% of these revenues originated in the United States. During this period, 99% of the total income from remittances was made through electronic transfers, registering a level of 36.572 billion dollars. Remittances made in cash and in kind represented 0.8% and 0.2% of the total amount, respectively.

Gabriela Siller, director of Analysis at Banco Base, explained through her social networks that the drop in remittances is related to the deterioration of the labor market in the United States.

With 12 million Mexicans living in the United States, remittances have become an important lever for the country’s economy. According to BBVA’s forecast, this year this source of income will be around 66.5 billion dollars, which will represent 3.7% of the national GDP. Through a study, the Spanish bank reports that 6.1 million people in the country depend directly on these resources.

The analysis indicates that remittances to Mexico have grown significantly in recent years. Between 2019 and 2023, they increased by 70.0%, going from 37.3 billion to 63.3 billion dollars. Thus, since 2021, Mexico has risen to second place worldwide as a recipient of remittances, displacing China, a place it continues to position itself since last year and until now.

Throughout his term, Mexican President Andrés Manuel López Obrador has celebrated the highest amounts of remittances received during his six-year term. This Sunday, in his last Government report, he again expressed his gratitude to Mexican migrants for sending these flows of money. “The support of our fellow countrymen to their families has become the main source of income for our country,” AMLO said during his speech at the Zócalo in Mexico City.

The boost that remittances have given to the Mexican economy in these first seven months of the year is not an isolated event, it responds to a regional boom. According to World Bank data for 2023, remittances to Latin America increased by 8% to 155 billion dollars during the past year. The international organization’s forecast outlines that, this year, remittances will grow by 2.7% in Latin America.

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