Mexico’s COVID-19 Briefing – March 20, 2020

Second casualty is confirmed

Mexico’s Ministry of Health reported that a 74-year-old man in Durango is the second casualty related to the COVID-19 outbreak. Of the total confirmed cases 64 percent are male and 36 percent female. Two percent are in a serious condition.

As of Friday, March 20

39 new cases (from yesterday) 

203 confirmed cases nationwide

606 under investigation 

2 casualties

Impact on markets (18.20 hrs)

US Dollar         MX$24.11       (0.10%)

BMV IPC         34,269.51        (-2.49%)

Dow Jones      19,536.65        (-2.74%)

Banxico cut rates to 6.50 percent

To counter the risks that pose significant challenges for the Mexican economy, Banco de Mexico (Banxico) today announced a 50 basis points out-of-cycle cut on Friday, bringing its benchmark interest rate to 6.50 percent. The decision came along other measures to support financial markets deeply affected by the COVID-19 outbreak, including dollar auctions to shield the battered Mexican currency. This was Banxico’s first unscheduled cut in four years. At the last monetary policy meeting on Feb. 13, the National bank cut 25 basis points of its benchmark to 7.0 percent, recording the fifth consecutive cut in response to the 0.1 percent contraction of the Mexican economy in 2019.

Citibanamex lowers growth forecast

Due to the growing impact of the pandemic on the global economy and a late response by Mexican authorities to face the health crisis, Citibanamex revised Mexico’s growth estimate this Friday from 0.5 to 2.6 percent contraction. Analysts of the banking institution foresee that the impact on the global and Mexican economies will be deeper than previously anticipated. According to Citibanamex, at the next Banxico meeting the members of its governing board will decide to lower the benchmark interest rate by 75 basis points, so it is likely to reach 5 percent by the end of this year.

US-Mexico border restrictions

All nonessential travel across the Mexico-US border is going to be restricted to prevent the spread of the COVID-19 pandemic. The restriction that also applies for Canada will go into effect on Saturday, as agreed by the three regional partners. “We are treating the borders equally, the northern border and the southern border,” Trump said during a press conference in the White House. There, Secretary of State Mike Pompeo highlighted that Mexico and the US know the importance of working together. “The United States is glad to have a friend that is working side-by-side with us,” Pompeo said.

Trump pushes for travel restrictions

After US President Donald Trump said that Mexico is suspending flights from Europe due to the COVID-19 pandemic, the Mexican Foreign Minister Marcelo Ebrard stated that Mexico's position is not to cancel or suspend any flights, but acknowledged that restrictions of travelers coming from Europe or Asia is being discussed with US authorities. In a press conference, the Chancellor said US Secretary of State Michael Pompeo expressed his concerns that people who might carry the virus from Asia or Europe can enter the US coming from Mexico. “We are trying to move forward. We understand that there have to be different kinds of restrictions,” Ebrard said.

Portal for stranded travelers

The Foreign Affairs Ministry (SRE) presented this Friday the new “COVID-19 Protection” portal for Mexicans stranded in different parts of the world due to the increasing travel restrictions. Mexican travelers who have suffered setbacks and need assistance to return to Mexico can register in the portal. Uploaded information will be protected under the Federal Law of Transparency and Access to Public Information and will be channeled to the relevant embassy or consulate to speed up assistance, according to a ministry´s spokesperson. Given the health contingency, SRE called on the people to use only official channels to provide personal information and also to limit travels abroad.

https://extranet.sre.gob.mx/proteccionCOVID19

Tabasco shuts public spaces

With two confirmed cases of COVID-19 in the state, Tabasco will decree the closings of nightclubs, cinemas and even rivers and beaches starting today, Gov. Adán Augusto López Hernández has reported. In a video message the Governor said office hours and daily activities for public officers are going to be limited, and that any rally, tour, meeting or massive gathering will be cancelled. “Suspension of activities in public spaces is mandatory. This includes bars, cafes, casinos, night clubs, swimming pools, and all kinds of beaches and rivers,” he said. López called on the people to behave responsibly because Tabasco’s future relies on them.

Cruises are banned for five weeks

All cruise ship arrivals to Mexico will be canceled over the next five weeks, the Mexican Cruise Association president José Arturo Musi has reported. The boats that were sailing to this destination have had to return to their ports of origin, so it is expected that in two weeks no tourist ship will be received at the ports of Cabo San Lucas, Mazatlán and Puerto Vallarta. Musi said the COVID-19 pandemic is generating an impact never recorded in the Mexican Pacific nautical tourism history.

Mexico cuts price for its Maya crude

In response to the drop in demand as a result of the coronavirus pandemic destroys fuel demand, combined with Saudi Arabia’s measures putting downward pressure on oil prices, PEMEX’s trading division PMI cut its Maya crude oil price by US$2 to a K factor of minus US$10.05. PEMEX’s oil hedge at US$49 per barrel only covers 234,000 barrels per day, which leaves the company with significant exposure to low oil prices after oi prices dropped by around 45% his month.