UPDATE 1-Mexico migrant remittances down 15.1 pct in June

MEXICO CITY, July 29 (Reuters) - The amount of cash sent home by Mexican migrants living abroad dropped by 15.07 percent in June from the same month last year, Mexico's central bank said on Wednesday. Remittances, sent mainly from the United States, totaled $1.923 billion in June, the bank said. The drop was less than the record year-over-year slide of nearly 20 percent in May as economy-watchers said the pace of the U.S.

recession easing. Cash sent home by millions of migrants in the United States is one of Mexico's top sources of dollars and an important pillar of consumer spending in the domestic economy. Remittances began declining last year for the first time on record, fell sharply in April and May and are expected to remain weak in 2009 as the U.S.

slowdown hurts sectors like construction, where many migrants work. A slower flow of workers across the shared border is also dampening the rate of wire transfers. The decline in remittances is hurting Mexico's balance of payments more than local consumption, as the peso has lost around one-quarter of its value since last year, allowing families to stretch lower dollar remittances further. Goldman Sachs analysts said in a report that they estimate remittances will decline to $21.2 billion in 2009 from $25.2 billion last year. (Reporting by Michael O'Boyle) Keywords: MEXICO ECONOMY/REMITTANCES ([e-mail]; Tel: [phone]; Reuters Messaging: [e-mail]) COPYRIGHT Copyright Thomson Reuters 2009. All rights reserved.

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