Mexican Peso to hold gains despite start of Banxico easing – ING

FXStreet Insights Team FXStreet

The Mexican Peso (MXN) continues to perform well and ride out Trump's fears. Economists at ING analyze MXN outlook.

Investors will favour the Mexican Peso

A 25 bps rate cut in March now looks likely. However, Banxico has said it will be very cautious in its rate cutting cycle and the starting point for real rates in the 6%+ area suggests the Peso does not have to sell off as easing starts.

Fourth quarter growth slightly disappointed last year, but consensus 2024 GDP growth is still 2.2% – which should be supported by loose fiscal policy this year. Elections in Mexico are held in June.

Factoring US elections is a tough call into the Peso, but a variety of positive factors suggests MXN outperforms its forward curve.

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FXStreet Insights Team

FXStreet

The FXStreet Insights Team is a group of journalists that handpicks selected market observations published by renowned experts. The content includes notes by commercial as well as additional insights by internal and external analysts.

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