Covid-19 A Major Risk To Mexico's External Account Stability

• Mexico’s external accounts will be impacted by falling goods exports, driven primarily by declines in manufacturing and the oil sector, and a deceleration in remittances amid the global Covid-19 (coronavirus) outbreak.
• As a result, Fitch has revised its forecast for Mexico’s current account to -1.1% of GDP, from -0.8% previously and –0.2% in 2019, as falling imports will limit the expansion of the current account deficit.
• Risks to the forecast are towards wider deficits, given risks to growth in the US, and risks to capital inflows stem from potential erratic policymaking and the poor finances of national oil company Pemex.

 (Source: Fitch)