Fitch Affirms Mexico's Long-Term Foreign-Currency IDR At 'BBB-' With Stable Outlook; Notes Proposed Judicial Reforms Could Negatively Impact Institutional Profile; Uncertainty Over Incoming Administration's Efforts To Narrow Deficit Consistent With Stable Debt/GDP; Expects Economic Activity To Pick Up For Rest Of Year After Weak Q1; Anticipates Slight Slowdown In Economic Growth Next Year
Portfolio Pulse from Benzinga Newsdesk
Fitch has affirmed Mexico's Long-Term Foreign-Currency IDR at 'BBB-' with a stable outlook. The agency notes that proposed judicial reforms could negatively impact the country's institutional profile. There is uncertainty over the incoming administration's efforts to narrow the deficit, but debt/GDP remains stable. Economic activity is expected to pick up for the rest of the year after a weak Q1, with a slight slowdown anticipated next year.
July 18, 2024 | 3:48 pm
News sentiment analysis
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NEUTRAL IMPACT
The affirmation of Mexico's credit rating at 'BBB-' with a stable outlook by Fitch is likely to provide short-term stability to the iShares MSCI Mexico ETF (EWW). However, concerns over judicial reforms and deficit narrowing efforts could introduce some volatility.
The stable outlook on Mexico's credit rating should provide some short-term stability to EWW. However, the potential negative impact of judicial reforms and uncertainty over deficit narrowing efforts could introduce volatility.
CONFIDENCE 80
IMPORTANCE 70
RELEVANCE 80
NEUTRAL IMPACT
The affirmation of Mexico's credit rating and the expected economic activity pickup may have a minor positive impact on the SPDR S&P 500 ETF (SPY) due to improved investor sentiment towards emerging markets. However, the overall impact is likely to be limited.
While the affirmation of Mexico's credit rating and expected economic activity pickup may improve investor sentiment towards emerging markets, the direct impact on SPY is likely to be limited.
CONFIDENCE 60
IMPORTANCE 30
RELEVANCE 30