The Day at a Glance | November 8 2021

The Top

*U.S. House of Representatives approved the infrastructure package worth 1 trillion dollars.

*Chinese exports once again exceeded estimates in October, despite disruptions among supply chains.

*Gross fixed investment increased 1.1% during August in Mexico (12.8% annual); private consumption fell (-) 0.6% in the same month (+9.6% annual).

*Biden administration considers the possibility of releasing oil reserves in light of high energy prices.

*Contagion in the Chinese market due to Evergrande: State-owned developer bonds fell.

*U.S. reopens its borders to travelers after pandemic.

Economic environment

The U.S. Congress approved the infrastructure package. After several months of negotiations, the House of Representatives approved a bipartisan infrastructure spending proposal worth 1 trillion dollars. The bill will be sent to President Biden for his signing after the Senate had approved it in August. The package was approved by majority decision (228-206) and considers 550 billion dollars in new spending projects destined towards transportation, public service networks, and internet; 110 billion will be destined towards roads and bridges, 66 billion towards passenger transportation and transportation of goods by railroads, 55 billion towards water systems, 39 billion towards public transportation and 65 billion towards internet. After its approval, the social spending package worth 1.75 trillion dollars will be discussed and approved by President Biden, which completes Biden`s economic agenda.

China`s trade surplus increased to record levels in October. Chinese exports grew at a 27.1% annual rate during October, figure way above the estimated 22.8%, and linked three consecutive months of double digit growth. With this, exports have remained well above pre-pandemic levels and their worth through the month of October exceeds all exports of 2020. Logistical issues, scarcity of containers, and lack of capacity in some ports don`t seem to be hindering China`s exports. Machines and electronic products have represented 60% of the total value of Chinese exports this year. Imports increased an annual 20.6% during the month and the trade surplus logged a record 84.54 billion dollars in October. The strength seen in exports has helped back economic growth in a moment in which the domestic market continues to show weakness.