MXN appears undervalued – TDS

Strategists at TD Securities gave their views on the Latam FX space.

Key Quotes

“Brazil growth continues to recover with stable momentum, though threats to global trade confidence may be rising. NAFTA negotiations have turned more positive in tone which is constructive for Mexican growth, which is being pressured by high interest rates, uncertainty over NAFTA, and the upcoming elections”.

“Though MXN has stabilized on improved NAFTA sentiment it remains undervalued, though uncertainty over the election and NAFTA remain high. BRL has perhaps seen risks increase given the newfound bursts of dovishness from the central bank in the absence of further structural reform. Risks to global trade sit in the backgound for now however and BRL will probably follow the broad USD beta”.