As we head into the last trading sessions of the first quarter, the Mexican leads the FX world. When using the dollar as base, the MXN is capturing a performance of less than 1%, however, most major currencies are declining YTD
Regional peers like the Brazilian Real and the Chilean Peso have turned lower vs the dollar, the latter is down 7.4% in 1Q
A measure of real FX rates points to the MXN reaching its highest level in more than 11 years. Deutsche Bank's MXN REER Index has recently extended above 2023 highs
The move has left the peso among the most overvalued currencies in the majors space. A ranking calculated by Bloomberg shows the peso trading 2 standard deviations above its 10-year average (bases on its Real Effective Exchange Rate)
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