Remittances to Mexico surged in May, confounding the majority of economists who expected the weakest U.S. jobs market in decades to take a heavier toll on migrant workers.
Money sent home by Mexicans abroad increased almost 3% from a year earlier, to $3.4 billion, the central bank said on its website Wednesday. Economists were forecasting a year-on-year decline, to $3 billion, according to a Bloomberg survey.
“Some of the subsidies that the U.S. government sent people were probably sent on to families abroad,” said Ricardo Aguilar, chief economist for INVEX brokerage in Mexico City, and the only analyst surveyed by Bloomberg who predicted an increase. “At the same time, the jobs market started to reactivate, and North American industry employs a lot of immigrants.”
Mexican remittances in the first five months of the year jumped more than 10% compared to 2019, to $15.5 billion. A weaker peso, after a 17% depreciation during 2020, means each dollar goes further for a family back home in Mexico.
The average remittance transaction amounted to $319 in May compared to $322 a year ago, the central bank said.