More bad news for the peso
Mexico was affirmed at BBB+ but the outlook was lowered to negative from stable. USD/MXN moved another dozen pips higher on the report. It's been a brutal stretch for the peso.
Comments from Fitch:
- Revision to negative reflects deteriorating balance of risks
- Sees scope for policy uncertainty
- Background of persistent economic underperformance
- Downside risks from the incoming administration's fiscal stance persist
- Energy reform could stall
- Decision to cancel Mexico City airport sends a negative signal to investors
- Budget expected in mid-December
- Pemex production continued to decline in 2018, which was not expected. Sees downside risks in 2019
