2021 registered the largest outflow of foreign capital in the government debt market since it has been registered, according to data from the Bank of Mexico.
The institution indicated that as of December 31 there were total 1.63 billion pesos, which meant a reduction of 257 thousand 601 million pesos compared to 1.89 trillion in the same period of a year before.
With this, the output of all 2020 was exceeded, because in the first year that the coronavirus pandemic began, 257 thousand 238 million pesos were withdrawn.
Carlos Capistrán, chief economist at Bank of America (BofA) Securities for Mexico and Canada, explained that this year continue the outflow of foreign capital.
“We hope that there will be, in general, for the year, exits, why? Because we expect exits in emerging markets; this is the year that the US Federal Reserve (Fed) is withdrawing monetary stimulus, it is even going to start selling bonds, we believe at the end of the year; it is going to raise its interest rates, we believe that four times, that is going to attract a lot of money, “he added.
He commented that this was a global phenomenon, however, in Mexico it was greater.
“There was capital outflow in Mexico last year and in all emerging countries; it is a global phenomenon. Now, it is true that in Mexico it seems to have come out more than in other countries, which does speak to the fact that there is also something particular in Mexico, “he said.
He added that the good news is that the emerging anticipate these Fed decisions.
“The good news is, how the emerging markets anticipate the Fed and raise rates sooner; and when the Fed is ‘on track’ raising interest rates, there could return a little money to emerging markets as things are more stable and as financial markets adjust, “he said.
Gabriela Siller, director of economic and financial analysis at Banco Base stressed that this is the second time that capital has left, something that had not been seen before.
“In 2021 there was a historical capital flight of 257 thousand 601 million pesos in government instruments, being the second year in a row with a historical exit, something unprecedented in Mexico,” he explained.