Treasury and Public Finance Secretary (SHCP) Luis Videgaray Caso said that Mexico is prepared to face the financial volatility caused by the United Kingdom leaving the European Union. Mexico will continue to strengthen its macroeconomics in order to lessen the blow on the economy.
The Exchange Commission entered a permanent session and will be attentive to the market, he said. In the case of speculation which could affect the peso, it will use the various tools at its disposal, such as the international reserves amounting to $177 billion and its International Monetary Fund (IMF) flexible credit line.
Videgaray Caso said that the Mexican government has already covered 100 percent of its financial needs for 2016 and that the volatility “will not affect the financial needs of the Mexican government.”
To ensure reaching the fiscal goal, he announced a second adjustment to 2016 spending, amounting to 31,715 million pesos ($1.6 billion) which will focus on the current expenditure.
The fall in oil prices has caused a need for an adjustment in public spending. “It is the government’s responsibility to tighten its belt, not Mexican families or businesses. By doing this, we maintain an atmosphere of stability, low-inflation and economic growth, so that Mexican families to have more spending power.”
At a press conference, accompanied by the Mexico Central Bank (Banxico) Deputy Governor Roberto del Cueto and Economy Secretary Ildefonso Guajardo, Videgaray Caso said that the economic relationship between Mexico and the United Kingdom amounts to only 0.7 percent of Mexico’s global commerce.
“We don’t expect that the UK leaving the EU will have an important impact on current expenditure and commerce,” he added.