GBP/MXN Outlook:
The GBP/MXN rate is likely to decrease as it trades below its recent average and is currently near recent lows, facing pressure from UK economic developments.
Key drivers:
• The Bank of England's dovish outlook on interest rates contributes to downward pressure on the Pound.
• The Mexican Peso benefits from attractive interest-rate differentials and has shown resilience against the backdrop of a weaker U.S. dollar.
• UK economic growth projections have been downgraded, suggesting weaker purchasing power and reduced investment.
Range:
Expect GBP/MXN to drift within its recent range without testing extremes if current trends continue.
What could change it:
• Upside risk: A surprising increase in UK economic data could support the Pound.
• Downside risk: Ongoing political instability in the UK may further weaken the Pound's value.
