There is no risk of USMCA collapse; USD/MXN outlook remains limited: BofA

Investing.com — Bank of America (BofA) has published an analysis regarding Mexico's economic strategy in the face of internal and external pressures. According to BofA, Mexico is prioritizing financial and monetary stability over economic growth while facing challenges such as constitutional reforms, uncertain U.S. policies, and the negative impact of U.S. tariffs.

Although these decisions are expected to slow Mexico's economic growth in the short term, the Mexican Peso (MXN) may remain relatively stable. Despite the U.S. imposing a 25% tariff on certain Mexican products, BofA does not believe there is a risk of collapse for the United States-Mexico-Canada Agreement (USMCA). Analysts foresee a potential renegotiation leading to USMCA 2.0, which would continue to support tariff-free trade across North America.