The Mexican economy has been weathering significant fluctuations over the last several years. A great deal of financial uncertainty in the country followed the election of United States presidential elections in late 2016, contributing to a downturn that carried over into 2017. However, it now appears the nation’s economic climate is on the rebound for the long term. International businessman and foreign exchange expert Pablo Soria de Lachica highlights the factors behind the upward swing, and discusses the improving Business Confidence of the Mexican economy, which includes the retaining of current trade agreements, corporate investments, and lowering inflation rates.
The first quarter of 2017 signaled a decline for Mexico monetarily, with Business Confidence hitting a low mark of 43.53 in February — a stark contrast to September of 2016 when it reached 48.30. Since then, positive overtones from the U.S. in regards to the North American Free Trade Agreement (NAFTA) have since triggered a surge in economic forecast. Conscious efforts by the Mexican administration to look beyond U.S. trade relationships has offered a boost as well. The United States recently reached an agreement to limit Mexican sugar imports into the U.S., a deal that is considered a positive step toward the renegotiation of NAFTA scheduled to take place later in August 2017. Pablo Soria de Lachica cites these developments as the main cause behind Mexico’s Business Confidence reaching 48.01 as of June 2017.
The steady strengthening of the Peso has been another positive stimulus to the nation’s turnaround.
“We see early signs that inflation is peaking,” Goldman Sachs chief Latin America economist Alberto Ramos told Bloomberg. “The noise around trade and the bilateral relationship with the U.S. has died down significantly.”
The Peso has risen 22 percent to levels stronger than 18 per dollar since February, amid hopes that NAFTA will remain in place. In relation to the business climate, Consumer Confidence in Mexico increased to 86.6 in July 2017 from 85.1 in June — the highest reading since July of last year.
Large corporations such as Amazon have taken notice of the positive trends, as the company recently launched their renowned Prime service within select Mexican cities. The cautious resurgence of the country’s economy was noted by IMF First Deputy Managing Director David Lipton after the conclusion of his visit in July.
“Mexico’s economy continues to grow and show resilience. This is a testament to the country’s fundamentals, prudent macroeconomic management, and a very strong policy framework, which underpins Mexico’s qualification for a Flexible Credit Line Arrangement with the IMF,“ Lipton said in a statement. “Mexico remains in a good position to manage risks and pressures emanating from the global economic and financial environment.”
Pablo Soria de Lachica is an internationally acclaimed broker and foreign exchange expert. A graduate of Universidad Tecnológico de México, Pablo presently collaborates with Kartoshka, a world leader in the creation of technology for sales, telemarketing and customer support. Pablo Soria also develops online trading tools for investors, while conducting market analysis and overseeing day-to-day financial operations for several prominent companies. A devoted philanthropist, his community support includes active involvement in local Boy Scouts and Delta Epsilon Sigma programs, along with generous contributions to several charitable entities.