Mexico central bank expects Trump policies to weaken 2017 growth

3/1/2017 Reuters

trump-inaugurationMexico’s central bank revised down its 2017 economic growth forecast on Wednesday to between 1.3-2.3 percent, citing myriad risks to Latin America’s No.2 economy from expected protectionist policies by U.S. President Donald Trump.

In a quarterly report on inflation, the bank said that policies proposed by Trump had already influenced consumer and business confidence, foreign direct investment and remittances to Mexico, as well as souring relations.

Trump, who softened his tone on immigration in a speech on Tuesday, has for months railed against Mexico’s “unfair” advantage under the North American Free Trade Agreement, while warning U.S. companies not to invest south of the border.

“The central growth scenario in this report incorporates a certain deterioration in expected trade flows between Mexico and the United States, and lower foreign direct investment than was previously foreseen,” the bank said.

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