01.04.202516:21:46UTC+00Mexican Peso Rebounds

The Mexican peso has appreciated beyond 20.3 per USD, bouncing back from a near one-month low of 20.47 reported on March 31st. Despite enduring trade uncertainties, the peso has demonstrated robustness, largely backed by reduced fears of a U.S. recession and President Sheinbaum’s achievement in negotiating a more favorable tariff position with Washington. Although Banxico's recent 50 basis points rate cut and indications of further monetary easing could potentially pressure the currency, local macroeconomic indicators, like business confidence remaining above contraction levels and stable gross fixed investment, have mitigated some of the downside risks. Additionally, the decrease in U.S. Treasury yields has weakened the dollar, thereby enhancing the peso's attractiveness in carry trades. While U.S. trade policy continues to pose a significant risk, the market is anticipating tariffs to be limited and short-lived, contributing to a relatively stable outlook for the peso in the near term.