Mexican Peso Is a Buy Regardless of US Vote Result, Ashmore Says

Maria Elena Vizcaino
2 min read

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(Bloomberg) -- The Mexican peso will be a bargain next week regardless of the US election outcome, according to Ashmore Group’s head of research Gustavo Medeiros.

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If Donald Trump returns to the White House, he’ll use his threats of steep tariffs merely as a tactic in renegotiating the US-Mexico-Canada trade agreement signed during his first term, Medeiros said. Trump’s policies won’t change Mexico’s structural story, he added.

“My playbook is to buy Mexico after the election,” he said in an interview in New York. “I don’t think people are paying attention.”

Buying pesos runs contrary to the consensus view among foreign-exchange traders, who fear Mexico will be among the hardest hit by Trump tariffs as it’s the largest trading partner with the US. The peso is one of the biggest losers among major peers this year, sinking 15.7% versus the greenback to trade above 20 per dollar, near multiyear lows.

Medeiros said the market is overselling the peso ahead of an election that’s too close to call. A Kamala Harris’ victory would spark a rally in the currency. On the other hand, Trump’s policies, he said, will end a period of exceptionalism for the US that’s seen stocks, bonds and the dollar appreciate indiscriminately.

“I’ll play Mexican peso versus the dollar,” he said.

Based in London, Medeiros advises the portfolio managers who buy stocks, currencies and bonds across the developing world for the firm, which oversees about $51.8 billion in assets. Ashmore’s $349 million Emerging Markets Debt Fund has returned more than 19% in the last year, beating more than 80% of peers, according to data compiled by Bloomberg.

He’s held back from favoring the peso this year. But he sees the US vote as a key moment.

“I’m willing to change and go marketweight on Mexican rates and buy local equities,” he said. “I don’t see any further negative catalysts.”

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