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By KELIN DILLON

According to the Mexican Secretariat of Finance’s newly released Public Finance and Debt Report, Mexico drew in 29.4 billion pesos less in public sector income than predicted by the 2024 Expenditure Budget of the Federation in January due to decreases in the country’s oil and tax revenues.

As a result, Mexico only took in a total of 658.9 billion pesos in public revenue during January 2024.

Oil-related income reportedly fell 26.7 percent year-over-year from January 2023 to January 2024, marking a full calendar year of the industry’s declines.

The decline comes partially as production from Mexico’s state-owned oil company, Petróleos Mexicanos (Pemex), stood at an average of 200,000 barrels per day lower than projected, as well as the declining strength of the U.S. dollar impacting Mexican oil exports.

Mexico likewise brought in 3.16 billion pesos less than predicted in tax revenue during January, registering 475.55 billion pesos in tax income for the month.

For CI Banco Deputy Director of Analysis James Salazar, Mexico’s tax revenue drop is correlated to the country’s recent decline in overall economic activity.

“The reality is that since the second half of last year, particularly in the last quarter, there has been a significant slowdown in economic activity, which mainly affects tax collection,” said Salazar.

However, despite dips in oil and tax revenue, January registered a significant 21.3 percent year-over-year increase in Mexico’s consumer spending.

Meanwhile, Mexico’s 150.76 billion peso budget deficit in January 2024 was 10.89 billion pesos below the budget’s scheduled deficit, though still significantly higher than January 2023’s registered deficit of 114.99 billion pesos.