ABSTRACT
The program plan was to reduce the fiscal deficit and eliminate its financing by the Central Bank. The real fiscal deficit has abated, a large market for government securities has developed, the economy has been opened to trade, and with price and exchange rates rising at a moderate pace, interest rates can perform once again their role of signaling financial market conditions. From a political point of view, the present administration is convinced that modernization requires a reassessment of public sector involvement in the economy and a revision of the performance criteria for public enterprises that are to remain public. The external shocks to which the economy was exposed, combined with the difficulties of coordinating different policy actions, resulted in extreme volatility of nominal and real interest rates and the real exchange rate. Mexico shared in the general stability that characterized the international economy during the postwar years.
