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Country Report Mexico Final

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Country Report Mexico Final
Country Report: An In-Depth Look inside the Mexican Economy

BY: Aly Gouda 4063562
Sam Abu
Hassan Bilal
Jesse Boeve

Intermediate Macroeconomics: International Financial Relations (ECB2IMAE)
Professor: Mark Schramm
Tutorial Group 2
Utrecht University

Country Report: Mexico
Intermediate Macroeconomics

Summary

A country of huge importance in Latin America, massive industrial prevalence on a world scale and a currency that is one of the worst behaving yet vital to investors both foreign and domestic in the region. Sharing borders with its biggest trading partner, the USA, Mexican products are exported around the world particularly north to the US itself. This paper provides an in depth analysis of the Mexican economy from a macroeconomic perspective.

Introduction

The Mexican economy is dynamic and very interesting to indulge in, regarding how much it is integrated on a global level. The Mexican economy interacts with a substantial amount of trading partners, both in the financial and goods services market. It is one of the largest economies in the South American region and has a number of very interesting characteristics. Although it is one of the largest producing economies in the region and has a relatively cheap currency, it has been in debt for most of the past decade. The Mexican economy is extremely reliant on its exports in order to perform well with the US being its biggest customer, buying up almost 80% of its exports.
This issue is due to many macroeconomic related events that we will discuss over the course of this paper.

We begin our in depth analysis of the Mexican economy by discussing the balance of payments and all of its components. We start off by discussing the current and capital account and then move on to discuss the component that financing the activities made by those account, which is the financial account. We then go further with our analysis by discussing the exchange rate and its fluctuations using different


Bibliography:  Mexico Inflation Rate. (2015, January 08). Retrieved from http://www.tradingeconomics.com/mexico/inflation-cpi  United States Inflation Rate  Krugman, P. R., Obstfeld, M., & Melitz, M. J. (2015). International Economics Theory and Policy (10th ed.). Essex, England: Pearson. Banco de Mexico. (2014). Foreign investment. Retrieved December 12, 2014, from http://www.banxico.org.mx/politica-monetaria-e-inflacion/estadisticas/graficas-de-coyuntura/comercio-exterior-y-balanza-de-pagos/foreign-investment.html Ibarra C.A., (2012) Mexico economy: Current account in surplus during first half of 2012. (2012, August 28). Retrieved November 24, 2014. WHITEFIELD, M. (n.d.). Low-gear growth predicted for Latin America. Retrieved January 9, 2015, from http://www.miamiherald.com/news/nation-world/world/americas/article1967453.html#storylink=cpy Fomento Economico Mexicano S.A.B
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