The Mexican peso is showing strength in trading, despite recent GDP data indicating a contraction of 0.6% in the fourth quarter of 2024. This raises significant concern for its future, particularly as the economy is slowing, especially in key sectors like primary and industrial. While external factors, such as the weakening U.S. dollar, have contributed to the peso's stability, potential U.S. tariffs and aggressive monetary policies from Banco de México could exacerbate economic challenges, leading to further depreciation of the peso in the long run. The overall outlook remains precarious amid uncertainties.
The peso's stability is a reflection of the U.S. dollar's weakness, but GDP contraction and slow growth raise serious concerns about its future.
The economic slowdown and potential U.S. tariffs present significant risks for the peso, highlighting the delicate balance of Mexico's economic situation.
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