March 1, 2001
Last year, Mexico registered its best economic performance in twenty years, thanks to strong growth and moderating trends in the country's current account deficit, external debt, and unemployment and inflation rates.
The country's GDP grew 7%, bringing average annual growth over the last five years to a healthy 5.5% Core inflation dropped to 7.5% in December 2000 from 14.2% at the end of 1999, and dipped under 7% this January.
In spite of a strengthening currency, Mexico's current account deficit was contained at an estimated 3.1% of GDP. As a result, the country's open unemployment rate fell to a record low 1.9% in December 2000 from a record high 7.6% in Aug
To avoid an increase in its current account deficit and increased pressure on the peso, Mexico needs to synchronize its business cycle with that of the US.