The international reserves of the Bank of Mexico (Banxico), which guarantee liquidity in dollars to respond to external shocks, stood at 202.399 million dollars as of December 31, 2021.
This balance of reserve assets is the highest for the end of a year since it has been registered, and is slightly lower than the historical record reached on September 3 of last year, after the injection of Special drawing rights (SDR) made by the International Monetary Fund (IMF), when they reached 205,559 million dollars.
Information contained in the statement of accounts of the Bank of Mexico shows that between January 1 and December 31, 2021 there was an accumulation of $ 6.732 million in its reserve.
This is the second highest annual savings in reserve assets since 2018 and only surpassed by the one achieved in 2020, of $ 14.79 billion.
Thus, in 2021 the Bank of Mexico spun a fourth consecutive year of accumulating international reserves, the result of the investment of assets in bonds issued by developed countries; by including the allocation of Special Drawing Rights made by the IMF in August and by incorporating dollars that Pemex exchanged for pesos with the central bank, as established by law.
To assess the relevance of this level of international reserves, it is enough to refer to the most recent review by the staff of experts from the IMF for Mexico, reported last November.
The agency’s experts explain that “Mexico’s external buffers have been strengthened after the injection of SDRs” and refer that according to their metrics, Banco de México’s reserves exceed the appropriate recommended asset levels by 28% and also represent 281 % of short-term debt maturities.
Doing the math
As explained by Banco de México itself, on its blog Banxico Educa, the main source of accumulation of international reserves from 2008 to 2014, it was the sale of US dollars Mexican oil (Pemex). This in view of the strong increase in oil prices.
In 2021, according to the central bank’s weekly account statement, the dollars exchanged by the oil company with the central bank totaled 1,158 million. This means that Pemex sold to Banco de México 17% of the 6.732 million dollars that accumulated during the whole of last year.