In addition to fears surrounding U.S. hikes, other aspects more specific to Mexico seem to be at play. A first contributing factor is Mexico’s weak fiscal position. Over the last several years, the historical balance of public-sector borrowing requirements relative to GDP has been persistently rising, to reach around 50 percent in 2016.
Also, financial deterioration in stateowned oil company Pemex, due in large part to lower international oil prices, has been a  3  See Alcaraz, C., et al. (2012). “Remittances, Schooling, and Child Labor in Mexico,” Journal of Development Economics, 97(1). 4  For an exposition on the energy reform in Mexico, see Torres-Barron, B. (2016).