Remittances to Mexico rise to second highest level on record

Mexico received $3.54 billion in remittances in June versus $3.38 billion in May and $3.18 billion in June a year earlier, the data showed. Drawing on the latest economic data, President Andres Manuel Lopez Obrador on Saturday evening estimated that remittances reached $3.48 billion in July, up from $3.26 billion a year earlier. The sharp contraction of activity and employment in the United States has not visibly impacted the flow of remittances to Mexico, said Ramos.

Remittances sent to Mexico, one of the main sources of foreign exchange for Latin America's second largest economy, rose in June to the second highest level since records began in 1995, central bank data showed on Monday. Mexico received $3.54 billion in remittances in June versus $3.38 billion in May and $3.18 billion in June a year earlier, the data showed.

Drawing on the latest economic data, President Andres Manuel Lopez Obrador on Saturday evening estimated that remittances reached $3.48 billion in July, up from $3.26 billion a year earlier. The bulk of Mexico's remittances are sent by the millions of Mexicans living in the United States and are a major support for the Mexican economy, which contracted a historic 17.3% in the second quarter from the previous three months.

"Solid workers' remittance flows have been adding support to the current account and to private consumption, particularly for low-income families, who have a high propensity to consume and are the overwhelming recipients of such transfers," said Alberto Ramos, economist at Goldman Sachs, in a note. The sharp contraction of activity and employment in the United States has not visibly impacted the flow of remittances to Mexico, said Ramos.

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