Mexico’s Peso Problems Are a Warning Sign for Global Investors
- Foreign investors hold more than $140 billion of Mexican debt
- Trump, inflation, credit rating and economy all pose risks
Silver coins are melted at the Mexican Mint, or Casa de Moneda, in San Luis Potosi, Mexico.
Photographer: Susana Gonzalez/BloombergThis article is for subscribers only.
The world has never been so invested in Mexico, and so Mexico has never posed a bigger potential threat to the world.
With a little more than six weeks before Donald Trump takes over with an agenda that could batter Latin America’s second-largest economy, Mexico is already showing signs of strain. Inflation is bouncing back, and traders bet it will only get worse; the peso has plummeted to record lows, and top analysts predict more pain; the government has lowered its growth forecast for four straight years, and Mexico is on the verge of a credit-rating cut just as Agustin Carstens gears up to leave the central bank after seven years at the helm.