EL PASO, Texas (Border Report) – The money citizens working abroad send home to relatives each month is one of the pillars of the Mexican economy. Remittances last year totaled $64.7 billion, or about 3.5 percent of the country’s gross domestic product.
That cash flow slowed at the end of last year and is down 5.5 percent year to year through the end of July, new data released by Banco de Mexico (Banxico) shows.
Mexican families have received $34.89 billion from January 1 to July 31, compared with $36.92 during the same period last year, the data shows. Nine out of 10 remittances to Mexico come from workers in the United States.
The biggest drop comes from electronic transfers, accounting for an almost $2 billion deficit. Cash sent in the form of money orders increased – by 11 percent, or a modest $8 million – adding to speculation that Mexicans in the U.S. are avoiding going out to money wiring services.
President Claudia Sheinbaum last month said Mexican immigrants are fearful of being caught up in the Trump administration’s push to deport those who are in that country illegally.
“What is this (the drop in remittances) related to? Most of all with the situation imposed by the United States on our migrant brothers,” Sheinbaum said on August 22.
She emphasized the Mexican economy remains on solid footing and that the cash flow from abroad is comparable to 2022 and atypical of the banner years of 2023 and 2024 for remittances. She said neither the drop in remittances nor U.S. tariffs have brought the country’s economy to a stop.
“Direct (foreign) investment was important during the first semester of 2025. Obviously, the new situation imposed by U.S. government on every country but, particularly, on Mexico has its effects. Some were betting that would collapse the Mexican economy, that there would be no development. But the truth is it is not,” Sheinbaum said.
Others are challenging the prevailing wisdom that Trump is to blame for Mexicans sending less money home this year.
“The only country where remittances are falling is Mexico. If it were the (immigration) raids, if it were fear of Trump, we should be seeing something similar in Central America or the Caribbean,” BBVA bank chief economist for Mexico Carlos Serrano told Milenio news portal.
Mexican workers aren’t incorporating to the U.S. economy at the same rate as in years prior. That’s a trend that precedes the drop in remittances, but wasn’t immediately reflected on the cash flow to Mexico due to a banner, post-COVID-19-pandemic U.S. economy, which has now slowed, too, he said.