USD/MXN za poslední tři obchodní seance vzrostl o více než 1,1 %, protože očekávání uvolnění měnové politiky Banco de México a klesající výnosy dluhopisů oslabují peso.
The Mexican peso continues to face a difficult environment in the short term. This can be seen in the recent performance of USD/MXN, which has gained more than 1.1% over the last three trading sessions, highlighting increasingly persistent weakness in the Mexican currency.
Buying pressure around the pair continues to be driven primarily by expectations of a more flexible Bank of Mexico over the coming months, along with the recent decline in Mexican bond yields. This dynamic remains relevant ahead of tomorrow's inflation release and, as long as markets continue to perceive a more cautious central bank, buying pressure around USD/MXN could remain a dominant theme in the sessions ahead.
What Is Expected From Mexico's Inflation Data?
Tomorrow's session will bring the release of inflation figures for the first half of October in Mexico. For now, markets expect a reading of 0.37%, slightly above the 0.33% recorded in the previous report.
These expectations remain important because they continue to point toward a relatively controlled inflation environment, with no clear signs of a significant acceleration in the short term. Forecasts have also remained fairly accurate in recent months. Since March, there have been no major deviations between market expectations and the final inflation readings, reinforcing expectations of a relatively stable inflation backdrop.
This continues to support the view that inflation does not currently represent a major threat to Mexican monetary policy, leaving room for the Bank of Mexico to adopt a more flexible stance over the coming months without the need to maintain exceptionally high interest rates.
Source: FXstreet
This remains particularly relevant because several members of the central bank's board have recently suggested there is less urgency to maintain an aggressive monetary policy stance. In fact, recent developments show that three of the five board members have expressed openness to discussing potential rate cuts, highlighting an increasingly cautious approach and a reduced level of concern over short-term inflation risks.
Most importantly, expectations of a more flexible central bank have already begun to affect Mexico's bond market. Over recent sessions, 10-year government bond yields have continued to decline, moving closer to the 9.2% area and pulling away from the highs observed several weeks ago.
This is significant because lower yields tend to reduce the attractiveness of peso-denominated investments while also weakening the appeal of the currency for international investors seeking high interest-rate differentials. As a result, demand for the Mexican peso could continue to soften in the short term.
Source: TradingEconomics
Taking all of this into account, expectations of a more cautious Bank of Mexico appear to be reducing the relative attractiveness of Mexico's fixed-income market and remain an important factor behind the peso's recent weakness. If tomorrow's inflation figures come in close to expectations and continue to show limited inflationary pressures, the perception of a more flexible central bank could gain even more relevance. Under that scenario, the peso may continue to struggle to recover ground, allowing buying pressure around USD/MXN to remain an important feature of the market.
USD/MXN Technical Forecast
Source: StoneX, Tradingview
The bullish trend is becoming the dominant structure:: Over recent weeks, USD/MXN has developed an increasingly aggressive bullish structure. The formation of higher highs and higher lows has reinforced a short-term uptrend, while a recent golden cross has emerged as the 50-period moving average moved above the 200-period moving average. This reading supports an increasingly constructive outlook for buyers and, as long as price continues breaking through key resistance levels, the current bullish trend could gain further strength in the weeks ahead.
MACD: The MACD histogram continues to trade very close to the 0 neutral line, reflecting a relatively balanced dynamic in short-term moving-average momentum. This reading suggests that despite the broader bullish structure, a degree of market indecision remains present.
RSI: The RSI remains particularly relevant as the indicator continues to trade close to the 70 overbought threshold. While this supports the strong bullish momentum seen in recent sessions, it also warns that buying pressure may be becoming stretched, potentially creating room for short-term technical pullbacks.
Key Levels:
18.70 – Key Resistance: A major resistance zone observed during previous months that remains the most important upside barrier on the chart. A sustained move above this level could reinforce bullish control, strengthen the sequence of higher highs, and support a more established uptrend over the coming weeks.
18.40 – Current Barrier: A level that aligns with important recent retracements and remains the main reference to monitor in the event of short-term bearish corrections.
18.00 – Key Support: A significant support zone observed during previous weeks that also coincides with an important psychological level for the market. A move back toward this area could place the current bullish trendline at risk and favor a more evident phase of consolidation in the short term.
Written by Julian Pineda, CFA, CMT – Market Analyst
UBS očekává, že kurz USD/MXN bude v září 2027 na úrovni 17,20, zatímco Crédit Agricole očekává 18,75; jejich výhledy pro mexické peso jsou tak protichůdné.
Mexican Peso Outlook UBS and Crédit Agricole Split Over 2027 Direction The Mexican Peso could strengthen or surrender ground against the US Dollar in 2027, with UBS and Crédit Agricole taking opposing currency views. UBS and Crédit Agricole expect the Mexican Peso to move in opposite directions over the coming year, setting markedly different forecasts for the same September 2027 horizon.
UBS projects USD/MXN at 17.20, against Crédit Agricole's 18.75.
The comparison captures a disagreement over the Peso's direction, with the exchange rate close to 18 in both banks' recent forecast documents.
Against that approximate reference, UBS's projection implies roughly 4.7% Peso appreciation, while Crédit Agricole's points to a decline of around 4%.
UBS retains its recovery view after a near-term setback UBS's optimism survives a recent reassessment of the Dollar's strength.
As Exchange Rates UK reported in our coverage of UBS's revised Peso outlook, the bank raised its nearer-term USD/MXN projection while retaining its September 2027 recovery target.
That earlier analysis argued that the Peso could continue to attract investors seeking interest income, even with a smaller advantage over US rates.
UBS said: "Despite the narrower US-Mexico rate differential, the global backdrop remains supportive for carry strategies given still benign financial conditions."
Investors funding Peso holdings in another currency must weigh the interest earned against both their financing costs and the risk of exchange-rate losses.
Mexico's central-bank overnight policy rate stands at 6.50%.
A weaker Peso can offset part or all of the additional interest income, particularly if US yields also rise and narrow Mexico's relative appeal.
UBS's earlier assessment identified a sharp US slowdown and disputes over the US-Mexico-Canada trade agreement as risks to the currency.
Those risks expose a tension in the Peso's relationship with its northern neighbour: a strong US economy can support Mexican activity, while higher US interest rates can make Dollar assets harder to compete with.
Crédit Agricole expects a less favourable outcome Crédit Agricole's higher USD/MXN target fits a more selective approach to emerging-market currencies.
In earlier coverage of its Latin American currency outlook, the bank distinguished potential gains elsewhere in emerging markets from a weaker assessment of the Mexican and Colombian Pesos.
The bank said: "We do not expect a full-fledged appreciation of EM FX vs the USD."
Its latest forecast leaves the Mexican Peso weaker by September 2027 even though the bank expects the Dollar to lose ground against some other currencies over that period.
The banks also differ on Mexico's economic prospects.
UBS forecasts 2% growth in 2027, against Crédit Agricole's 1.2%, giving the Swiss bank a stronger domestic growth outlook alongside its more favourable currency projection.
USD/MXN exchange rate FAQ Will the Mexican Peso rise or fall vs the US Dollar in 2027?
The banks disagree. UBS expects appreciation by September 2027, while Crédit Agricole expects depreciation.
What are their USD/MXN targets?
For September 2027, UBS forecasts 17.20 and Crédit Agricole forecasts 18.75.
Does a lower USD/MXN mean a stronger Peso?
Yes. Each US Dollar would buy fewer Mexican Pesos.
USD/MXN dnes vzrostl o více než 1,2 %, protože inflace v Mexiku ve výši 3,45 % neposílila očekávání razantnější měnové politiky mexické centrální banky.
Despite the recovery attempt seen at the start of the week, a renewed phase of weakness has become increasingly evident around the Mexican peso in the short term. This can be observed in recent USD/MXN price action, with the pair gaining more than 1.2% during today's session, reflecting a stronger U.S. dollar and a renewed loss of ground for the peso.
For now, buying pressure remains relevant around the pair even after the release of Mexico's inflation figures. This reaction suggests that markets still do not see enough room for a significantly more aggressive Bank of Mexico in the near term. As long as expectations remain centered on a cautious central bank, part of the relative appeal that the peso has maintained through its interest-rate advantage over other currencies may continue to fade, a dynamic that could keep supporting USD/MXN strength in the sessions ahead.
What Happened with Mexico's Inflation Data?
Mexico released its latest inflation figures during today's session. Annual inflation came in at 3.45%, slightly below the 3.47% expected by the market. However, the reading increased from the 3.12% observed in July and the 3.26% reported in August, reflecting a moderate acceleration compared with previous months.
Even so, the most important point is that inflation remains within the Bank of Mexico's target range and continues to trade below the upper limit of 4.00%, meaning that the recent increase remains relatively contained.
In addition, much of the increase came from more volatile components, mainly food prices, while core inflation continued to moderate for an eighth consecutive month, reaching 3.75%, its lowest level since 2025. This is particularly important because it suggests that the rebound in headline inflation is being driven by isolated factors rather than a broad-based acceleration in inflationary pressures. As a result, the data does not currently appear to represent a significant threat to the cautious policy approach that the Bank of Mexico has maintained in recent months.
Source: TradingEconomics
This remains important because the latest inflation figures do not appear strong enough to alter current expectations regarding Mexican monetary policy. For now, markets continue to price in a benchmark rate close to 6.50% by the end of 2026, assuming inflationary pressures do not deteriorate more significantly over the coming months.
This outlook is also reflected in the bond market. Yields on 10-year Mexican government bonds had already been moderating before the inflation release and continue to trade around the 9.3% area, moving further away from the highs observed earlier this year. Meanwhile, U.S. Treasury yields continue to display a different dynamic, holding near 5.2% and reflecting far greater stability in recent market activity.
The difference is important because, while Mexican bonds have gradually begun to lose some of their appeal, U.S. Treasuries continue to offer relatively attractive yields, a situation that could keep supporting capital flows toward dollar-denominated assets.
Source: TradingEconomics
Taking all of this into account, expectations of a more cautious Bank of Mexico have begun to reduce part of the relative appeal of the Mexican fixed-income market, while U.S. yields continue to show greater stability. This environment could continue limiting the attractiveness of peso-denominated investments and support demand for dollar-denominated assets. As long as these conditions remain in place, the Mexican peso may continue to struggle to recover ground consistently, leaving room for continued buying pressure around USD/MXN in the sessions ahead.
USD/MXN Technical Forecast
Source: StoneX, Tradingview
The aggressive uptrend continues to gain relevance: Over recent weeks, USD/MXN has been developing a pattern of higher highs, allowing a relevant bullish trendline to emerge in the short term. This structure remains the dominant technical pattern on the chart and, as long as buying pressure remains intact, the trend could continue consolidating as the market's primary technical reference in the weeks ahead.
MACD: The MACD histogram continues to trade above the 0 neutral line, reflecting that short-term moving-average momentum continues to favor a relevant bullish bias. This reading supports the importance that buying pressure continues to have within the pair's recent price action.
RSI: A similar picture can be observed in the RSI, which remains above the 50 neutral level, supporting the strength of the recent bullish momentum. However, the indicator has also moved above the 70 overbought threshold, a development that highlights the speed of the recent rally and could leave room for short-term corrective pullbacks.
Key Levels:
18.50 – Major Resistance: A zone of significant highs observed in previous months that currently stands as the most important upside barrier on the chart. Price action that manages to consolidate above this level could reaffirm the dominance of buying pressure, reinforce the development of higher highs, and support a more established bullish structure over the coming weeks.
18.00 – Current Barrier: A level that aligns with recent retracement zones and an important psychological reference for the market. This area could become the primary level to watch in the event of short-term corrective declines.
17.70 – Key Support: A zone of important lows observed in previous weeks that remains the most relevant downside barrier on the chart. Price action returning toward this area could place the current bullish trendline at risk and begin to reflect a more evident loss of direction, potentially favoring a broader phase of neutrality in the short term.
Written by Julian Pineda, CFA, CMT – Market Analyst
UBS has trimmed its near-term Mexican Peso recovery expectations, although it still sees interest rates supporting the MXN.
Foreign exchange analysts at UBS have raised year-end US Dollar to Mexican Peso (USD/MXN) exchange rate forecasts to 17.50 from 17.20, scaling back the recovery they expect from the Mexican currency.
Its March 2027 projection also rises to 17.40 from 17.20, while June and September remain unchanged at 17.20.
The revision follows a difficult week for the Peso: Federal Reserve exchange-rate data show USD/MXN rising from 17.2252 on 21 September to 17.6932 on 25 September.
UBS's new December target still sits below that Friday reference rate, implying some recovery in the Peso rather than further depreciation.
Higher global yields have reduced Mexico's interest-rate advantage, but UBS retains its case for carry, the income available from holding a higher-yielding currency.
"Despite the narrower US-Mexico rate differential, the global backdrop remains supportive for carry strategies given still benign financial conditions."
The bank expects Mexican policymakers to resist following the Federal Reserve mechanically:
"We expect Banxico to hold rates at 6.50% through 2026, prioritizing domestic conditions over its policy stance relative to the Fed."
Banxico held rates in September but removed guidance favouring an extended pause.
Goldman Sachs envisages a stronger near-term Peso recovery, forecasting USD/MXN at 16.75 in three months and 17.00 in six months.
Its twelve-month target of 17.25 is slightly above UBS's September 2027 forecast of 17.20, leaving little disagreement at that horizon.
UBS identifies US growth and trade relations as potential threats to the Peso's interest-rate appeal:
"A significant slowdown in the US economy would pressure the peso, as would USMCA trade disputes. Conversely, healthy risk sentiment and a search for carry could boost the peso, as would positive signals to investors from the US president."
Carry can cushion returns, but a large fall in the Peso can outweigh that income.
Exchange Rates UK Research
Our currency coverage draws on live market data, official economic releases and published bank research.
Crédit Agricole čeká postupné oslabování mexického pesa a vidí USD/MXN na 19,00 v prosinci 2027. To by proti referenční sazbě 17,27 znamenalo asi 9,1% pokles hodnoty pesa vůči dolaru.
Foreign currency strategists at Crédit Agricole expects gradual Mexican Peso depreciation throughout 2027, despite recognising the support that higher yields give emerging-market currencies. The Mexican Peso is among the currencies Crédit Agricole expects to weaken even as much of the emerging-market sector withstands higher US interest rates.
The bank forecasts the US Dollar to Mexican Peso exchange rate (USD/MXN) at 18.00 in December 2026, rising to 18.25 in March 2027 and 18.50 in June.
Its targets then reach 18.75 in September and 19.00 in December 2027.
Against the bank’s 22 September reference rate of 17.27, the final target implies a 10% rise in USD/MXN, equivalent to roughly a 9.1% fall in the Peso’s Dollar value.
Crédit Agricole explicitly separates Mexico from its more favourable regional views:
“From an FX regional angle, we expect a slight appreciation of Asia vs the USD, and of CE4 vs the EUR, but expect more weakness in Latam (the COP and MXN in particular).”
Higher yields offer support, but currency losses remain a risk The bank acknowledges that emerging-market currencies have resisted pressure from rising US yields:
“Since the beginning of July, the US 10Y yield has increased by about 60bp. Yet, during the same period, our EM FX index appreciated vs the USD.”
On the interest-rate advantage over the US, it adds:
“Third, the average EM-US carry gap has remained decent, in spite of the recent increase in US short-term rates. This is because higher oil prices have also put a floor under EM short-term rates.”
Even so, the bank cautions:
“We do not expect a full-fledged appreciation of EM FX vs the USD.”
For Mexico, Crédit Agricole forecasts the policy rate remaining at 6.50% through December 2027, matching the current rate in Banco de México’s official figures.
The distinction between interest income and currency performance also featured in Rabobank’s warnings about Peso carry in May.
Our reading is that attractive yields alone do not invalidate Crédit Agricole’s forecast: investors can collect interest while losing value when Peso holdings are converted back into Dollars.
Exchange Rates UK Research Our currency coverage draws on live market data, official economic releases and published bank research.
USD/MXN za poslední tři seance vzrostl o více než 1,7 %, protože peso před zítřejším rozhodnutím Banxica ztrácí sílu. Trh čeká, že sazby zůstanou beze změny už potřetí v řadě.
Over recent trading sessions, the Mexican peso has started to show signs of losing strength against the U.S. dollar. This can be seen in the performance of USD/MXN, which has gained more than 1.7% over the last three sessions, highlighting the dollar's renewed strength against the peso. Buying pressure has remained in place even as markets prepare for tomorrow's Banco de México policy decision, suggesting that expectations surrounding the event have not been sufficient to support a more consistent recovery in the Mexican currency. If this dynamic continues, buying pressure around USD/MXN could remain relevant in the sessions ahead.
What Is Expected from Banxico's Decision?
Tomorrow, Banco de México will announce its latest monetary policy decision. Despite maintaining one of the highest interest rates among major central banks, currently at 6.5%, markets are widely expecting policymakers to leave rates unchanged for a third consecutive meeting.
This expectation is largely driven by the recent evolution of inflation. Although price pressures remain present, inflation has slowed significantly over the past several months. After reaching a peak of 4.59% in March 2026, inflation has followed a consistent downward path, falling to 3.26% in August, a level that is now relatively close to Banxico's 3.00% target. This contrasts with the United States, where inflation continues to hold near 3.4%, still above the Federal Reserve's 2.00% objective. As a result, while markets expect Banxico to maintain a more stable stance, expectations for the Fed continue to point toward a more restrictive monetary policy.
Source: TradingEconomics
This divergence is becoming increasingly important because markets are now assigning more than a 70% probability to another Federal Reserve rate hike at the October meeting, potentially taking rates to the 4.25% area. Although Mexico continues to maintain a significantly higher policy rate than the United States, the discussion is no longer focused solely on current levels but rather on the direction each central bank may take in the months ahead.
This divergence is already beginning to show up in the bond market. Mexican 10-year government bonds continue to offer attractive yields around 9.3%, but those yields have started to moderate as investors increasingly expect Banxico to keep rates unchanged. By contrast, U.S. 10-year yields continue to move higher and remain slightly above 5.00%, supported by expectations of a more aggressive Federal Reserve.
Source: TradingEconomics
This development matters because a significant part of the peso's strength throughout much of 2026 was supported by the wide interest-rate differential with the United States. However, as markets continue to price in a more aggressive Fed and a more neutral Banxico, part of that relative advantage may gradually begin to shrink. While Mexican assets continue to offer higher yields, U.S. assets combine rising returns with a lower perceived level of risk, a combination that could continue to favor demand for U.S. dollars over the Mexican peso.
Under this backdrop, if Banxico once again confirms a stable policy stance tomorrow, the peso could continue to struggle to regain ground against the dollar. As a result, buying pressure around USD/MXN could remain a relevant market theme in the weeks ahead.
USD/MXN Technical Forecast
Source: StoneX, Tradingview
A new bullish move begins to take center stage: For most of the year, USD/MXN traded within a well-defined downtrend that served as the dominant technical structure on the chart. However, the recovery seen in recent sessions has produced a meaningful break above that trendline, with prices now challenging important resistance levels. If buying pressure remains in place, the pair could begin developing a new short-term uptrend in the weeks ahead.
MACD: The MACD histogram continues to develop above the 0 neutral line, a reading that suggests short-term moving-average momentum remains tilted to the upside. As long as this behavior persists, buying pressure could continue playing an important role in the market.
RSI: A similar picture can be observed in the RSI, which remains above the 50 neutral level, supporting the importance of the recent bullish momentum. However, the indicator has also moved above the 70 overbought threshold, suggesting that the pace of the recent advance has been significant and could leave room for short-term corrective pullbacks.
Key Levels:
17.65 – Major Resistance: A significant high from previous months that currently stands as the most important upside barrier on the chart. Sustained price action above this level could reinforce the dominance of buying pressure, support the formation of higher highs, and encourage the development of a more established bullish structure in the weeks ahead.
17.39 – Current Barrier: A level that coincides with the 200-period simple moving average and remains the nearest technical reference to monitor in the event of short-term bearish corrections.
17.15 – Key Support: An area that aligns with the 50-period simple moving average and the base of the former bearish structure. A move back toward this level could highlight a renewed lack of direction and favor the development of a broader trading range over the coming weeks.
Written by Julian Pineda, CFA, CMT – Market Analyst
Mexická inflace klesla na 3,37 % a je na pětiletém minimu, což může oslabit peso a udržet USD/MXN v nejistotě. Trh sleduje rezistenci 17,90 a support 17,10.
The Mexican peso continues to face difficult trading sessions. Over the last 3 trading sessions, average USD/MXN movements have posted a gain of more than 1.00% in favor of the U.S. dollar, which continues to reflect weakness around the peso.
This scenario did not fully change after the release of Mexico’s inflation data, which showed a significant decline. This new reading could start to affect expectations for higher interest rates for longer, which in turn could limit the strength of the Mexican peso. In this context, USD/MXN could continue to show a phase of indecision or even more relevant buying pressure over the next few sessions.
Inflation day for Mexico During today’s session, Mexico’s annual average inflation data was released. Initially, the consensus expected a reading near 3.52%, but the official figure surprised to the downside and came in at 3.37%, below expectations and at its lowest level in the last 5 years.
This data is relevant because it marks a significant decline compared to previous months. It also confirms a downward trend in the consumer price index, which has been falling from this year’s high near 4.59%. With this new release, inflation is moving increasingly closer to the central bank’s target of around 3.00%.
Source: TradingEconomics
This scenario could be important for the Mexican peso’s movements, as one of its main advantages against the U.S. dollar has been the wide rate differential between both central banks. While the Bank of Mexico keeps its interest rate around 6.5%, the Federal Reserve maintains a benchmark rate near 3.75%.
For months, this differential has positioned the bond market and Mexican peso-denominated investments as potentially more attractive options compared to dollar-denominated investments. To some extent, this has helped sustain demand for the Mexican peso.
Source: TradingEconomics
However, the outlook could start to change. The latest inflation release marks an important shift in the price dynamic and could reduce the need for additional interest rate increases in Mexico. It could even gradually open room for rate cuts from the current 6.5% level over the coming months.
For this reason, the latest data could point to a calmer Bank of Mexico, with no need to deliver significant additional interest rate increases.
When comparing this potential dynamic with the Federal Reserve, the scenario is different. In the United States, inflation has not shown such significant declines, and CME Group’s probability table still points to a probability above 51.00% that, at the September 16 decision, the interest rate could move from the current 3.75% level toward a new 4.00% reference.
This suggests that the Federal Reserve could still maintain an aggressive stance over the coming months.
Source: CMEGROUP
This point is key because an important difference between both central banks is starting to emerge. While the market could begin to price in a calmer Banxico, the Federal Reserve remains close to a more aggressive scenario.
This combination could reduce the rate differential that has supported the Mexican peso over the last few months. For that reason, rather than strengthening the peso, the latest inflation data could suggest that, over time, peso-denominated investments may become less attractive compared to U.S. dollar-denominated investments.
If this central bank dynamic continues, the peso could struggle to recover ground consistently in the medium term. This could reflect not only a phase of indecision in USD/MXN, but also more relevant buying pressure over the coming trading weeks.
Technical outlook for USD/MXN
Source: StoneX, Tradingview
Sideways range stronger than ever: Since February 2026, USD/MXN has not managed to define a clear direction or consolidate a more structured trend line. This has led to the formation of a relevant sideways range, with resistance near 17.92 and support around 17.10. As long as the pair fails to break out of these barriers, it will be difficult to confirm a firmer trend. For this reason, indecision could remain the dominant technical pattern over the coming trading weeks.
RSI: movements do not show significant short-term strength and remain close to the neutral 50 area. This suggests a balance between buying and selling impulses in the market, reinforcing the importance of the current indecision phase.
MACD: shows a similar reading, with the histogram remaining close to the 0 level. This reflects balance in the strength of short-term moving averages and confirms that indecision is still present in average USD/MXN movements. If this behavior persists, neutrality could remain relevant over the next few sessions. Key levels:
17.90 – Main resistance: This recent high zone remains the main bullish barrier above the 200-period simple moving average. Sustained moves toward this zone could mark the beginning of a more consistent buying bias and open room for the possible formation of a bullish trend line over the coming weeks.
17.52 – Current barrier: This is a relevant retracement level from recent weeks and an important neutral zone to watch. If price fails to move away from this level, the indecision phase could be reinforced, and the sideways range could extend as the dominant chart structure in the medium term.
17.10 – Relevant support: This zone corresponds to the 2026 lows and is currently the main bearish barrier. Moves toward this level could bring the selling bias back into focus and give continuity to the descending channel that remained the dominant structure months ago.
Written by Julian Pineda, CFA, CMT – Market Analyst
The Mexican Peso remains one of JP Morgan's preferred emerging-market currencies, with the bank arguing that improving domestic growth, attractive carry and resilient trade flows continue to support MXN.
USD/MXN is forecast to ease from current levels, with JP Morgan targeting 17.35 by September 2026, 17.30 by December, 17.30 by March 2027 and 17.30 by June 2027.
JP Morgan analysts say Mexico's economic outlook has improved after a weak start to the year.
"Some green shoots point to a more benign picture for growth in 2H26."
The bank notes that stronger-than-expected April GDP, a rebound in construction activity and robust services growth have prompted it to lift its 2026 GDP forecast from 1.0% to 1.2%.
JP Morgan also expects Banxico to keep its benchmark interest rate unchanged at 6.5% over the coming year as inflation remains comfortably within target.
The bank believes the successful conclusion of the latest USMCA review also removes an important source of uncertainty for investors.
Rather than reopening the agreement, the US, Canada and Mexico agreed to continue negotiations under the existing framework, preserving Mexico's privileged access to US markets.
Carry Trade Still Supports the Peso
JP Morgan argues the Peso's biggest strength remains its attractive yield.
"The structural view for MXN remains constructive, anchored by decent volatility-adjusted carry."
With market volatility easing after the Middle East conflict and Mexico's balance of payments remaining resilient, the bank believes the Peso should continue attracting international capital.
