Remittances To Mexico Drop For Fourth Straight Month With Trump Policies Impacting Flux

Remittances from the U.S. to Mexico dropped for the fourth month straight in July, according to the Mexican central bank. The figure, which clocked in at $5.33 billion, represents a 4.7 percent decrease compared to the same month last year, the institution noted.

So far this year people in the U.S. have sent $34.88 billion to Mexico, a 5.5% drop at an inter-annual level. Moreover, remittances sent abroad from Mexico reached $100 million in July, a 9 percent inter-annual drop. The accumulated figure for 2025 so far is $687 million, a 13.7% drop compared to the same period last year.

After record levels of $64.7 billion in 2024, remittances to Mexico are projected to fall to $61 billion this year, a decline driven by both reduced U.S. labor participation among Mexican migrants and fear of deportation.

Mexican President Claudia Sheinbaum downplayed the impact of the reduced amount in late August, claiming it "has not been that drastic."

However, other reports show that at least some communities that have long depended on remittances are facing an abrupt slowdown.

The Washington Post reported last month that communities in Oaxaca, historically major sources of U.S. migrants, are particularly affected. In some areas, remittances account for more than 10% of local economic activity, supporting construction, small businesses, and family expenses. Local officials note that fewer families are receiving consistent payments, leaving towns struggling to maintain economic activity.

Experts consulted by the outlet explained that the Trump administration's immigration crackdown has prompted both voluntary returns and reduced work participation among Mexicans in the U.S., while fewer new migrants are entering the labor market. Analysts note that remittance flows naturally depend on ongoing migration, and Mexico's migration levels have fallen over the past 15 years.

Economists warn that the drop could slow local economies in Mexico, potentially driving more people to migrate north in search of work. "Remittances get invested not in infrastructure or in factories but in human capital and in schooling," said Michael Clemens of George Mason University, highlighting the broader developmental impact.