A low-volatility environment makes the Japanese yen the most attractive funding currency. This makes the MXN/JPY pair an excellent choice for carry trading right now.
Maintaining a strong peso due to core inflation forecasts keeps the high-risk adjusted carry of MXN attractive with the ultra-low JPY.
If market doubts BoJ's interventions, MXN/JPY could reach 9.50. Uncertainty lies in the sustainability of BoJ's interventions in the future.
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