In May, the MXN appreciated marginally from 18,005 to 17,718 against the USD. MUFG Bank economists analyze the outlook for USD/MXN.
The Mexican Peso is unlikely to weaken sharply
We expect the Fed to keep its policy rate unchanged and a US default avoided, which would cushion upside risks to USD/MXN.
Looking ahead, we maintain our view of a moderate weakening of the MXN in the coming quarters, influenced by a set of factors. Concern about the global economic slowdown, and especially about a slowdown in the US that could stop the inflow of dollars into Mexico.
On the local side, fears of further government interference in private industry may be dampening sentiment. But we do not expect a sharp weakening of the MXN.
forecast for second quarter of 2023: 17,800. Third trimester of 2023: 18,000 Fourth trimester: 18,200. First quarter of 2024: 18,200.
Source: Fx Street
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