"10% drop in remittances to Mexico in July, but cumulative growth remains."

The reception of remittances in Mexico has experienced a notable slowdown during the month of July, marking a 10% drop compared to the previous month. According to the Bank of Mexico, the country received a total of 5.614 billion dollars, a figure that contrasts with the more than 6.2 billion recorded in June. This decline is not only reflected in the current month but also marks a slight decrease of 1% compared to July of last year, when remittances reached 5.668 billion dollars. The report from the Bank of Mexico highlights that in July 2024, approximately 14 million transactions were made, with an average remittance of 402 dollars per transfer. These numbers suggest that, despite the decrease in the total amount of remittances, the activity remains significant and vital for many families in the country. However, in the year-to-date figures, remittances have shown a positive trend. From January to July 2024, Mexico has received 36.94 billion dollars in remittances, representing an increase of 2.9% compared to the same period last year. More than 96% of these funds come from the United States, underscoring Mexico's economic dependence on its northern neighbor. A relevant fact is that 99% of remittances have been made through electronic transfers, totaling 36.572 billion dollars, while cash and in-kind remittances barely represent 0.8% and 0.2%, respectively. This trend towards digital transfers indicates an evolution in the way migrants send money to their families, reflecting the digitization of financial services. The decline in remittances received in July has been analyzed by Gabriela Siller, director of Analysis at Banco Base, who attributed this situation to the deterioration of the labor market in the United States. This critical factor may affect the ability of migrants to send money to their families in Mexico, which in turn has repercussions on the country's economy. With approximately 12 million Mexicans living in the United States, remittances have become a fundamental pillar for the Mexican economy. A study by BBVA estimates that this year, remittances will reach 66.5 billion dollars, equivalent to 3.7% of the national GDP. According to their projections, 6.1 million people in Mexico depend directly on these resources, highlighting the importance of this flow of money in the daily lives of many families. Historically, remittances to Mexico have grown considerably in recent years. Between 2019 and 2023, they increased by 70%, rising from 37.3 billion to 63.3 billion dollars. This growth has led Mexico to become the second-largest recipient of remittances in the world, surpassing China, which held that position until last year. President Andrés Manuel López Obrador has continuously praised the amounts of remittances received during his administration, highlighting the positive impact they have on the country. In his recent government report, AMLO reaffirmed his gratitude towards Mexican migrants, noting that their support for their families has become the main source of income for the country. Despite the decline in July, the overall outlook for remittances in Mexico remains optimistic. The continuous growth in the year-to-date figures and the increase observed in Latin America, where remittances grew by 8% in 2022, reinforce the idea that this phenomenon is not isolated but part of a regional boom. The World Bank forecasts that remittances in Latin America will grow by 2.7% in 2023, which could positively influence the Mexican economy in the coming months.