Mexico records worst monthly remittance decline since 2012
MEXICO CITY, June 2 (Reuters) - Remittances sent to Mexico recorded an 12.1% slump in April compared to a year earlier, according to central bank data published on Monday, marking the steepest drop in over a decade as U.S. lawmakers mull a tax on such payments sent abroad.
Mexico is the world's second largest recipient of remittances, received $4.76 billion in April, as workers living abroad sent fewer transactions as well as smaller payments.
April's data marked the steepest year-on-year drop since September 2012, according to central bank data.
Some 12.3 million Mexicans live abroad and 97% of these live in the neighboring United States, according to estimates last year from BBVA Research, which said last year had marked Mexican remittances' eleventh straight year of growth.
Banco Base economic analysis director Gabriela Siller said April's drop was likely due to a weaker U.S. job markets and migrants' fear of losing their jobs or being deported.
"The April remittance data is terrible," she said in a post on X, attributing the drop to "the deterioration of the labor market in the U.S. and U.S. migrants' fear of going out to work and sending their remittances, for fear of being deported."
The central bank said April saw 8.1% fewer transactions than a year earlier while payment amounts were down 4.4%.
Mexican officials have argued that taxing remittances could violate the countries' treaty to avoid double taxation, as migrants' income tax are already subject to local taxes.
In 2024, Mexicans living abroad sent some $64.75 billion home in remittances - largely from Texas and California to states in central and western Mexico - breaking a fresh record.
Through the first four months of 2025, the central bank recorded remittances of $19.02 billion, down 2.5% from last year.
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