Economy & Business - December 2007 (ISSN 1741-7430)

What happens in the US, both politically and economically, will determine how the Mexican economy performs in 2008. Our view is that the worst of the subprime mortgage crisis in the US may well be over. What is happening now is that the construction industry in the US has adjusted to the lower demand, hence the poor November figure for permits (the figure was the lowest since 1994). This recalibration of expectations will ripple on through the rest of the US economy, but there will not be the major write-offs and lay-offs that some pessimists expect. Our main reason for this guarded optimism is remittance data.

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