The Mexican peso enjoyed this century’s second-strongest bull run in the first half of the year, with wide rate differentials, stable public finances, “nearshoring” hopes, and surging inward remittance flows, combining to send the exchange rate soaring.

The Banxico’s commitment to maintaining benchmark interest rates at least 600 basis points above their US equivalents has done much of the heavy lifting, with returns on dollar-funded trades exceeding 19 percent this year. Despite a reputation as a leftist economic nationalist, President Andrés Manuel López Obrador has proven less interventionist and more fiscally conservative than investors once feared. The country has pushed out China as the top exporter to the United States. And income sent home by Mexican workers in the United States is running at more than $5 billion a month.

Remittances sent from workers outside Mexico, 12-month rolling sum, billions USD