Trade deficit with Mexico at its lowest since July 2015

U.S. trade with Mexico grew in January, but the trade deficit with the country — a major talking point for President Trump — fell to its lowest point since July of 2015. 

The U.S. trade deficit with Mexico fell roughly 9 percent to $3.9 billion in January 2017 from $4.3 billion in January 2016, according to figures released by the Department of Commerce.
 
Still, trade between the two countries grew 6.3 percent in the same period.
 
Mexican imports grew to $23.5 billion in January 2017 from $22.4 billion in January 2016. But Mexicans also bought more U.S. goods in January — $19.5 billion compared to $18 billion a year ago.
 
January’s $3.9 billion deficit is the lowest since July 2015, when the U.S. ran a $3.7 billion deficit with Mexico.
 
Mexico is among several countries that Trump has blasted in criticizing the U.S. trade deficit.
 
“With Mexico we have $70 billion in deficit. … It’s unsustainable. … We’re not going to let it happen, can’t let it happen,” Trump told a group of CEOs in February, according to CNN Money.
 
The goods trade deficit with Mexico in 2016 was $63 billion.
 
Trade tends to slow down in January, but the total volume of both imports and exports from Mexico so far this year is the highest ever number for January.
 
Mexican exports were likely driven by a depreciated peso, which in January hit historical lows after Trump’s inauguration. A lower exchange rate makes Mexican exports cheaper for U.S. consumers.
 
The peso saw an uptick last week, spurred by comments by Commerce Secretary Wilbur Ross saying the currency could recover some of its value under a renegotiated North American Free Trade Agreement (NAFTA).
 
The trade deficit is calculated only using trade in goods. The annual trade deficit with Mexico is substantially smaller when accounting for trade-in services.
 
According to the U.S. Trade Representative (USTR), the United States services trade surplus with Mexico was $9.2 billion in 2015.
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