MEXICO CITY: Mexico’s factory exports suffered their biggest fall in over two years in May, pointing to weaker demand from its main trade partner, the United States, though a jump in non-oil consumer imports pointed to more robust spending at home.
Manufactured exports fell 6.6 per cent in May compared with April in seasonally adjusted terms, the national statistics office said, the biggest decline since January 2013.
Auto exports slid 3.51 per cent, while non-auto exports from Latin America’s No. 2 economy tumbled by 8.14 per cent.
Mexico exports mostly manufactured products, such as televisions and cars, versus reliance on raw materials like iron and soya beans elsewhere in the region. Nearly 80 per cent of exports head to the United States.
The data showed non-oil consumer imports rose in May by 7.4 per cent from April, marking the fastest expansion since May 2010 and pointing to stronger consumer demand.
A sharp slump in the peso to a record low earlier this year has made imports more costly.
Mexico’s economy grew at its slowest pace in over a year in the first quarter, undermined by flagging oil revenue and weak US growth.
Mexico posted a $1.803 billion trade deficit in May when adjusted for seasonal swings, the statistics agency said. In non-seasonally adjusted terms, Mexico posted a trade deficit of $1.017 billion.
Separate data showed Mexico’s adjusted jobless rate ticked up in May by a tenth of a per centage point from the previous month to 4.4 per cent, the highest rate since Feb Barrera
Mexico expects a finalised 12-nation Pacific trade deal to double the country’s agricultural exports to Japan’s mostly closed market, and the deal will likely be signed in the “next few weeks,” a senior trade official said on Friday.
The so-called Trans-Pacific Partnership, or TPP, would potentially cover 40 per cent of the world economy and raise annual global economic output by nearly $300 billion.
Deputy Trade Minister Francisco de Rosenzweig said in an interview that Mexico’s main aims in the final stretch of TPP negotiations are maintaining privileges with the United States, destination of about three-quarters of the country’s exports, plus prying open new markets in Asia.
The TPP is the biggest trade deal since the North American Free Trade Agreement (NAFTA) liberalised commerce between the United States, Canada and Mexico two decades ago.
“Without a doubt, our priority is to strengthen our productive framework with the United States and preserve our preferential trade status that we have under NAFTA,” de Rosenzweig said.
“Our second priority is to have a strong presence in Southeast Asia as well as access to the agricultural market in Japan.”