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Thursday, January 12, 2012

Remittances to Mexico Rebound

by Calculated Risk on 1/12/2012 11:34:00 AM

This is another indication of an improving labor market.

From Ricardo Lopez at the LA Times: Remittances to Mexico are rebounding

Head to 4th Street and Broadway in downtown Los Angeles and you'll see signs of a labor market on the mend.

At a Continental Currency Services Inc. branch, a check-cashing and money-transfer business, housekeeper Maria Guadalupe Gutierrez waited patiently in line on a recent afternoon to wire $200 to her mother in Chiapas, Mexico.
Ending a three-year slump, remittances to Mexico are finally on the upswing, thanks to an improving U.S. job market. Analysts expect that money sent home last year by Mexicans living abroad, most of them residing in the United States, will top $23 billion when Mexico's central bank releases annual figures this month. Although still below the peak of $26 billion in 2007, that would be a solid 8% increase over 2010.
Remittances to Mexico Click on graph for larger image.

Here is a graph of the annual remittances to Mexico. This is money sent home by Mexicans worldwide, although this is mostly from the US. The data is from Banco de México.

Remittances increased sharply during the housing bubble, and declined by about 15% in 2009. Remittances will probably increase about 8% this year.