Mexico scrambles to cut spending under shadow of credit downgrades

09/12/16 Reuters

peso by Guanatos GwynWeak growth, low oil prices and difficulties in making promised spending cuts all threaten Mexico’s push for a budget surplus next year as credit rating agencies consider downgrading its debt.

After running primary budget deficits since 2009, Mexico last Thursday pledged to turn a projected primary deficit of 0.4 percent of gross domestic product into a surplus of 0.4 percent of GDP next year.

Standard & Poor’s and Moody’s put Mexico’s credit outlook on negative this year, flagging concerns that weak growth could keep pushing up debt after a collapse in oil prices hit Mexico’s income from crude sales.

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