By Gabriel Burin
BUENOS AIRES, July 1 (Reuters) – Mexico’s peso will likely hold steady near the middle of its well-established trading range at least into the first half of 2027, a Reuters poll found, supported by foreign exchange market expectations for an economic recovery.
Except for a brief tumble at the start of 2020 the currency has traded between 16 and 22 per U.S. dollar since July 2015, with a midpoint around 19.
The peso is set to trade near there this time next year, according to the median estimate for 17.78 per dollar in a year among 24 FX specialists polled June 26 to July 1.
That 12-month forecast would imply a slight 1.7% depreciation from 17.48 on Tuesday. Year-to-date the currency is up around 3% against the dollar, keeping firm despite the greenback’s recent gains.
Michael Pfister at Commerzbank said this was “probably because the USD’s strength is based on expectations of a more robust U.S. real economy from which Mexico should benefit.”
More concrete signs of recovery in actual economic forecasts are yet to be seen, however, as the country’s outlook remains weak due to uncertainty over the future of the U.S.-Mexico-Canada Agreement (USMCA) on trade.
Analysts also said the peso may soften if dovish policymakers push for the resumption of interest rate cuts, which would reduce carry trade flows to profit from Mexico’s relatively high cost of borrowing.
The central bank, known as Banxico, held its benchmark rate at 6.50% last month in a unanimous decision, beginning an anticipated pause in the face of mixed inflation trends.
“While MXN has benefited from a resilient U.S. economy and relatively positive global risk sentiment … Banxico’s dovish bias in recent meetings has hindered MXN’s carry appeal,” Deutsche Bank analysts wrote in a report.
“We turned neutral MXN … and still prefer BRL as an expression of a bullish view in the region,” they added.
Among 11 contributors who answered an extra question on the skew to their views for the peso in 12 months, six said they were tilted to a weaker currency, two leaned to a stronger peso and three took a neutral stance.
In the same question on Brazil’s real, six of 13 responses pointed to depreciation risks, three to a firmer currency and four participants said they were neutral.
The real was forecast to weaken 2.6% in 12 months to 5.30 per U.S. dollar from 5.16 on Tuesday. So far in 2026 the currency is up 6.2%.
(Other stories from the July Reuters foreign exchange poll)
(Reporting and polling by Gabriel Burin in Buenos Aires; additional polling by Mumal Rathore and Indradip Ghosh in Bengaluru; Editing by Ross Finley and Hugh Lawson)
