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The high uncertainty triggered by the Covid-19 crisis has stressed the need to monitor the evolution of the economy in “real time”. We developed a set of Big Data indicators to track Investment in Real Time and High Definition, extending the analysis to assess the business cycle and complementing our tracker of consumption.
In July 2020, the balance of current credit granted by commercial banks to private sector grew at a nominal annual rate of 4.9% (1.3% real), lower than the nominal rate observed the previous month (6.5%) and the nominal rate of 8.6% registered in the same month of 2019, reducing its dynamism for the third consecutive month.
With Covid-19, it is not only necessary to take care of physical health, but also financial health, mainly because we are exposed to negative variations in income. The note presents recommendations in case of being under these variations.
This week the Ministry of Finance released the fiscal package that he presented to Congress for next year. It is the third presented by this administration. I think it is positive that, after three fiscal packages, it can be confirmed that it is a government committed to maintaining fiscal balances.
September 8, 2020
Mexico | Economic package 2021 based on relatively optimistic GDP and income assumptions
The economic package reinforces the signal of fiscal discipline by establishing a primary balance of 0% of GDP. It is positive that the federal government has proposed that goal instead of the deficit of 0.6% of GDP that it had suggested in Pre-Criteria for 2021.
The financial system maintains its stability, five months after the start of the pandemic, supported by the adequate levels of capitalization and liquidity of the banking system, as well as the special regulatory measures adopted by the financial authorities.
45.9% of women and 31.3% of men who sent remittances do so to cover health expenses (medical attention, medicines, laboratory tests, hospital, etc.) in households in Mexico. By the end of 2020, remittances could reach USD $ 39.4 billion, + 8.1% y/y.
Banco de México should not react to recent increases in inflation. In the absence of structural inflationary pressures, the central bank should continue to relax monetary policy.