As the United States continues to reevaluate its interest rate policy, the Mexican peso is gaining strength and remains one of the most appreciated currencies in the world. This trend is likely to continue for the rest of 2022 and beyond. However, the strength of the currency will depend on how Mexico’s economy performs in relation to the U.S. and the level of inflation.

Investors are betting on continued strength in the Mexican economy and a more hawkish stance by Banxico, which is expected to lift interest rates again in July. This will be the first time since June of last year that the central bank has raised its key rate by more than 1%. The move will most likely be a response to a rise in US inflation and expectations of more to come.

The strong Mexican economy is driven by the country’s main industries, including oil and agriculture, but also by a robust inflow of remittances. The stronger peso also helps to attract foreign investment, which in turn leads to more jobs for Mexicans.

President Andres Manuel Lopez Obrador has been quick to take credit for the strength of the “super peso.” His administration’s budget austerity and his pledge not to take on new debt have bolstered confidence in Mexico’s economy and currency.

But economists say there are other reasons the peso has gained so much strength this year. Among them are the falling value of the dollar and the fact that Mexico’s debt is lower than in other emerging countries.

Mexico’s public debt represents only about 46% of its GDP, the second lowest in the world after Brazil. And it’s growing at a slower pace than the country’s economy.

The strength of the peso has also been boosted by the fact that Mexico has been a safe haven for investors seeking to avoid risks in other markets. This has helped the peso gain ground against the euro and other currencies.

In the long run, the How is the Mexican peso getting stronger? will depend on how a recession in the United States affects the Mexican economy and how quickly the country can bounce back from any negative impact.

XP Investimentos analyst Marco Oviedo said that the Mexican peso’s strength will also depend on whether the Fed raises interest rates again in July or not. He says that if the Federal Reserve does increase interest rates, it could cause the peso to weaken against the dollar. Regardless, Oviedo believes that the strong Mexican economy will keep the peso at an advantage over the dollar in the coming years. This will make the country an attractive destination for foreign investment. However, he warns that the higher peso could lead to more inflation in Mexico and a slowdown in economic growth. This is because more goods would cost a lot more in dollars than they do in pesos. He adds that it’s important for the government to find ways to control inflation and not overheat the economy in order to maintain the peso’s strength.