The market bias for the USD to MXN exchange rate is currently bearish.
Key drivers include:
- The anticipated interest rate cuts by the Federal Reserve, which are expected to weaken the USD as policymakers adjust their stance by mid-2026.
- Optimistic economic forecasts indicate some growth in the Mexican economy, supporting the MXN.
- Analysts predict that stable exchange rates for the MXN will preserve its competitive position against the USD.
Near-term, analysts expect the USD/MXN to remain within a defined range, showing stability in the market despite recent fluctuations.
Upside risks to this forecast include stronger-than-expected economic growth in the U.S., which could support the USD. Conversely, a downside risk lies in the potential divergence in monetary policies between the U.S. and Mexico, which could apply downward pressure on the MXN. Given current pricing, the USD is trading at 7-day highs near 18.02, showing slight volatility within a 4.5% range recently observed.