The Mexican peso weakened to 18.5 per US dollar in February 2026, losing approximately 12% from its mid-2024 high of 16.3. The depreciation reflected concerns about potential US tariffs on Mexican imports, a judicial reform that unsettled foreign investors, and a gradual easing of monetary policy by the Bank of Mexico (Banxico), which cut its benchmark rate to 9.75% in February.
The Nearshoring Opportunity
Mexico has been a major beneficiary of the global shift to nearshoring, as companies diversify supply chains away from China. Foreign direct investment in Mexico reached a record $36 billion in 2025, with significant investments from Tesla (Gigafactory Monterrey), BMW, Foxconn, and dozens of Chinese companies establishing manufacturing in Mexico to maintain access to the US market under the USMCA trade agreement.
The industrial real estate market in northern Mexico (Monterrey, Saltillo, Ciudad Juarez) has seen occupancy rates exceed 97%, with rental rates rising over 30% in two years. New industrial park construction has lagged demand.
Remittances
Remittances from Mexicans working in the US reached $65 billion in 2025, making Mexico the second-largest remittance recipient globally after India. These flows support consumption in smaller cities and rural areas. Increasingly, crypto-based remittance services (Bitso, Stellar-based networks) are competing with traditional operators like Western Union, offering lower fees of 1-3% compared to 5-8% through conventional channels.
Tariff Risk
The US administration has threatened 25% tariffs on Mexican imports as leverage on migration and fentanyl enforcement. Such tariffs would significantly disrupt the $800 billion bilateral trade relationship and undermine the nearshoring thesis that has driven investment. Uncertainty about US trade policy has led some companies to delay investment decisions.
For Banxico data, visit Bank of Mexico. For trade data, see US International Trade Commission.