MORENA Party Poised for Significant Influence in Mexican Congress

Mexico’s ruling MORENA party and its allies are projected to secure 83 seats in the next Congress, nearing the two-thirds majority needed for constitutional changes. This has emerged concerns in the markets, as both outgoing President Lopez Obrador and President-elect Claudia Sheinbaum support significant reforms including judiciary and energy regulators' overhaul.

Mexico's ruling MORENA party and its allies will likely have 83 senators in the next Congress after last Sunday's vote, just shy of the two-thirds majority needed to change the constitution, the interior minister said on Wednesday, citing preliminary results.

Mexico's upper chamber of Congress totals 128 members. Uncertainty over the makeup of the next Congress, which takes office in September, roiled markets earlier this week since both outgoing leftist President Andres Manuel Lopez Obrador and President-elect Claudia Sheinbaum have signaled their support for sweeping reforms to the constitution.

The potential reforms include the elimination of independent energy regulators, while consolidating power in the executive branch, in addition to an overhaul of the judiciary that would see popularly elected Supreme Court judges. In the 500-member lower house of Congress, the ruling leftist coalition will have 372 seats, the super majority needed to change the constitution unopposed, according to preliminary results.