Mexican workers abroad sent home a record amount of cash in March, aided by stimulus checks from the administration of U.S. President Joe Biden.
Total remittances reached $4.15 billion, up 31% from the previous month, according to central bank data released on Monday. The number was also about 2.6% higher than the same period last year, and topped the median forecast of $3.81 billion from analysts in a Bloomberg survey.
Remittances to Mexico have been on the rise since the pandemic began, surprising analysts who had expected the opposite. Latino families in the U.S., where most Mexican immigrants live, suffered a harsh economic toll from the virus. Still, U.S. stimulus continues to boost money sent home, according to Alberto Ramos, chief Latin America economist at Goldman Sachs & Co LLC.
“The expectation of continued fiscal stimulus and robust growth profile in the U.S. should keep remittances flow strong in 2021,” Ramos wrote in a research note. “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.”
As the U.S. Covid vaccination campaign kicked into full gear in early 2021, job prospects for Mexican immigrants improved. Compared to March of last year, the number of employed Mexican workers increased by 275,000, according to the Center for Latin American Monetary Studies.
President Andres Manuel Lopez Obrador had projected last week remittances would hit a record in March, after totaling $40.6 billion in all of 2020. An estimate of 12 million Mexican workers live outside the country, and remittances account for roughly 3.5% of the country’s gross domestic product.
