Nowhere is Mexico’s economic integration with the United States more evident than in the high correlation between both countries’ industrial and manufacturing outputs. Furthermore, causation runs from the larger country to the smaller one. Inevitably, U.S. manufacturing fragility translates into a slower sector in Mexico.
Reforms in the financial sector will be geared toward maintaining a strong banking system and a vibrant capital market. The BSP remains committed to strengthening the banking system through structural reforms and speedier disposition of non-performing assets. At the same time, continuing asset clean-up of banks should help spur credit and investments, thereby generating support for more sustainable economic activity in the medium term.