The gloomy economy of Mexico is not a problem for the peso

This year's operations should continue carry trade who helped boost the Mexican peso exceed 15 other major currencies, since the interest rate The key stays in a maximum decade.

The the currency rose 3.6 percent this month to 18.76 for a dollar, which raised its profit by 4.7% during the year, defying a gloomy local economy and political tensions with the USA on its northern border.

The reason is easy to find. With a key rate of 8.25%, the peso offers the possibility of third best value between the currencies of developed countries and currencies Emerging Markets followed by Bloomberg. Only Argentina and Turkey, countries with much higher monetary volatility and much worse economic bases, have higher interest rates than Mexico.

Most economists and operators expect that the decline in economic chance of Mexico finally weigh on the weight. Opinion by consensus in the last Citibanamex survey it suggests a depreciation of the peso above $ 20 per dollar by the end of the year, while futures markets suggest the currency could fall between 19:30 and 19.82 in December. The operations of carry trade will amortize or delay weight drop, according to some badysts.

"Part of the reason why we have the weight flat in the second and third quarters, the high interest rate and attractiveness of foreign exchange trading, "says Wells Fargo strategist Brendan McKenna At New York. McKenna expects the currency to fluctuate around 19 for a dollar before falling to 19.25 at the end of the year.

The curve of the to exchange TIIE of Mexico includes in the prices a reduction of the interest rate benchmark of 20 basis points over six months, suggesting that the central bank will probably remain in place before moving to lower rates in the fourth quarter.

Banxico maintained nail aggressive stance in its monetary policy decision of March 28, citing underlying inflation and an increasingly complex environment for Mexico, both domestically and abroad. Gerardo Esquivel, recently appointed by the President, was the only member who disagreed with this statement. Andrés Manuel López Obrador. Esquivel voted with the others to leave the rates unchanged, but pleaded for a more neutral tone for the statement.

As Esquivel is still in the minority, it is unlikely that the peso will cancel its gains in the short term.