MercoPress. South Atlantic News Agency

Largest fall in remittances from Mexicans in US

Remittances from Mexicans living in United States dropped 12% in August, the largest fall since the Bank of Mexico began tracking records twelve years ago, the country's Central bank reported on Wednesday

After years of record gains, remittances from the US have dipped across Latin America as the US economy slowed and the dollar fell, slashing the real value of money sent home. Mexicans migrants are sending less money home, stranding small towns and neighbourhoods that live off the stipends and remittances will likely continue to fall in the coming months amid the "difficult problems the US economy faces" said Mexico's Central bank. Remittances dropped 12% to 1.9 billion US dollars, compared to 2.2 billion in August 2007, the bank said. For the first eight months of the year, they dropped 4% to 15.5 billion dollars. The slowing US economy and stepped-up US immigration enforcement, including record deportations and increased border security are behind the drop. Money sent homes by Mexicans working abroad is the second-largest source of foreign income after oil exports. Most of the money comes from the US, which is home to 98% of the at least 11 million Mexicans living abroad. So far Mexico has largely weathered the global economic crisis, buoyed by a national housing boom and government-funded infrastructure programs. But Treasury Secretary Agustin Carstens said this week that Mexico will still be hit as tourism (third source of foreign income) drops and continued volatility deflates oil and other commodity prices. He has lowered his annual growth forecast for Mexico to 2.5%.