Mexico's President Enrique Pena Nieto and his US counterpart Donald Trump have agreed not to talk publicly for now about payment of the wall the US President wants to build on the United States' southern border and that he says Mexico should finance.
In a statement, Mexico's government said that during a phone call on Friday, the two had held "constructive and productive" talks and broached issues including the US trade deficit with Mexico and the flow of illegal arms and drugs across the border.
"Regarding payment of the border wall, both Presidents recognised their clear and very public differences of opinion on this sensitive subject, and agreed to resolve their differences as part of a comprehensive discussion on all aspects of the bilateral relationship," the statement said.
"The Presidents also agreed for now to not talk publicly about this controversial issue."
Mr Trump said he had a "very good" phone call with his Mexican counterpart and agreed to work to improve ties after a meeting between the two leaders was scrapped amid a dispute over funding Mr Trump's planned border wall.
"We had a very good call. I have been very strong on Mexico. I have great respect for Mexico ... but, as you know, Mexico with the United States has out-negotiated us and beat us to a pulp through our past leaders. They've made us look foolish," Mr Trump told a news conference at the White House.
Mr Trump said the call was friendly and he looked forward to renegotiating the US trade relationship with Mexico in the future.
His comments come after he tweeted on Friday that the southern neighbour had taken advantage of it long enough and demanding that "Massive trade deficits & little help on the very weak border must change NOW!"