The economist at the Institute of International Finance warned that the return of foreign capital to Mexico, which was observed during the month of August, in the amount of 1919 million dollars, was part of a general influx towards emerging countries that were not yet able to sustain themselves in September. IIF), Jonathan Forton.
During the eighth month of the year, all emerging markets, with the exception of China, recorded investment inflows of $27 billion.
In an interview with El Economista, the expert ruled out the upward cycle of the continuous rate in Mexico as the pull factor for this positive record.
The markets operate systematically, and in August, they saw a small window of opportunity that they seized. But he noted that “since September, a match has lit up, which has ignited a more pessimistic dynamic.”
From Washington, he predicted that global liquidity will continue to decline in the face of restrictive strategies applied by the central banks of advanced economies, such as the United States. This context will reduce capital flows to emerging countries, which in turn will plunge into uncertainty and volatility due to geopolitical issues in light of the situation in Russia and China.
He explained that capital flows are expected to continue declining between now and the end of the year due to the high return that advanced economies will continue to provide.
Caution about Mexico
The strategic analyst acknowledged that during the month of August, we had the first positive reading towards debt securities in a six-month period, amounting to about $ 1919 million.
He explained that this restriction is not sufficient to compensate for the previous liquidation. In fact, in the case of accumulation since January, we have negative flows of $3,800 million.
Markets will try to find a security moat, those that offer advantages in their stable financial conditions, attractive trade balance and competitiveness.
We are not very negative about the future outlook, but we have to be more careful about the dynamic ahead. We always appreciate the work of Banco de México. But he said markets remain attentive to Pemex’s financial issue, respecting regulations, and as they get closer they will have a bigger magnifying glass to see the state of the economy more carefully.