Explore the world.

Assess underlying market conditions and fundamentals in the world's major economies.

World

Stay ahead.

Follow the biggest stories in markets and economics in real time.

Subscribe

Get insight into the latest trends and developments in global currency markets with breaking news updates and research reports delivered right to your inbox.

After signing up, you will receive regular newsletters from Corpay, and may unsubscribe at any time. View Corpay’s Privacy Policy

The peso’s bull run has run out of steam.

After a world-beating drive higher, the Mexican peso lost momentum late in the third quarter and has largely failed to regain it, staging a relatively modest rebound against a retreating dollar. Several factors are in play: A drastic increase in government spending plans – coming ahead of the presidential election in June 2024 – spooked investors. The foreign exchange commission’s decision to unwind its non-deliverable hedging programme put pressure on spot rates. And the Banxico began making dovish noises, suggesting that it might begin cutting rates by March.

Change in spot exchange rates, DXY and MXNUSD

We think markets overreacted to all three: In relative terms, the government’s fiscal position is strong. The decision to shelve a peso-supportive intervention tool should be seen as a vote of confidence in underlying fundamentals. And real rate differentials remain extremely supportive, with authorities still strongly committed to maintaining positive carry.

US Job Market Hits Wall, Raising Fed Easing Expectations
Bond Market Turmoil Eases As Labour Markets Slow
Sentiment turnaround
Strains Grow As Investors Shun Long-Term Debt
Debt worries
Jump In Long-Term Yields Pummels Currency Markets

Latest Analysis

Latest Analysis