Fitch Affirms Mexico's IDR Amid Uncertain Economic Landscape

Fitch Ratings has affirmed Mexico's Long-Term Foreign-Currency Issuer Default Rating (IDR) at 'BBB-' with a stable outlook. While judicial reforms may negatively impact institutional profiles, the economic activity is projected to improve this year, though a slight slowdown is expected next year. Trade tensions with the U.S. could also pose vulnerabilities.

Fitch Ratings has affirmed Mexico's Long-Term Foreign-Currency Issuer Default Rating (IDR) at 'BBB-' with a stable outlook. The agency addressed concerns about proposed judicial reforms that could negatively impact Mexico's institutional profile, noting it is still too early to gauge the potential severity.

Fitch also highlighted the uncertainty surrounding the incoming administration's efforts to narrow the fiscal deficit to levels consistent with a stable debt-to-GDP trajectory. Economic activity in Mexico is expected to pick up for the remainder of this year, despite a weaker first quarter, though a slight slowdown is anticipated next year.

The report also warned that increased trade tensions with the U.S. could render Mexico vulnerable, depending on the electoral outcome in the neighboring country.