Report published September 28, 2026
USDMXN: Carry Amid Global Rate Volatility – UBS FX Strategy Report
UBS · September 28, 2026
UBS CIO expects Banxico to keep policy rates at 6.50% through year-end 2026, decoupling from the Federal Reserve's trajectory. Consequently, the global carry backdrop remains constructive for the Mexican peso, leading UBS to revise USDMXN forecasts to 17.5 for 4Q26 and 17.4 for 1Q27 before settling at 17.20.
Read the remaining 3 pages
Finvaulta summarizes UBS's analysis. Attribute opinions, forecasts, time-sensitive values, and chronology to the issuer and report date; do not treat this page as an independent verification or a current market-data source.
Key Takeaways
- 1.Banxico is expected to hold policy rates unchanged at 6.50% through 2026, prioritizing domestic conditions over the Fed's stance.
- 2.Global conditions remain supportive for carry trades despite narrowing US-Mexico rate differentials, supported by benign financial conditions.
- 3.USDMXN forecasts have been revised slightly higher for 4Q26 to 17.5 and 1Q27 to 17.4, while 2Q27 and 3Q27 targets remain steady at 17.20.
Table of Contents
- Key drivers
- Risks to our view
- Factors to watch
Report data
Figure 1 - USDMXN: Exchange rate (incl. forward rates), CIO forecasts, and volatility range — as of September 28, 2026.
| Metric | Estimate | Context |
|---|---|---|
| USDMXN Spot Exchange Rate | 17.7 MXN per USD | Current exchange rate level as of 25 September 2026. |
| USDMXN Forecast 4Q26 | 17.5 MXN per USD | Revised upward from previous forecast of 17.2. |
| USDMXN Forecast 1Q27 | 17.4 MXN per USD | Revised upward from previous forecast of 17.2. |
| Banxico Policy Rate | 6.50% | Banxico unanimously held its policy rate in September and is expected to maintain it through year-end. |
| Mexico GDP Growth (QoQ) | 1.4% | Quarter-over-quarter GDP growth masked weak underlying momentum. |
Reports in this series
CIO View is shown in chronological order through this edition, published on September 28, 2026.
Part of the CIO View series — view all 59 editions
Looking for the latest edition? USDBRL A rightist election outcome English 1667672 (Oct 12, 2026)
- Sep 24USDCHF en 1667086
- Sep 24EURNOK en 1667092
- Sep 24Global direct real estate en 1666630
- Sep 25USDILS en 1666917
Access the full report
And others from the leading tier 1 banks.
Free account: read previews and a daily allowance of full reports. Pro removes the daily limit.