The material on this site is for financial institutions, professional investors and their professional advisers. It is for information only. Please read our Terms & Conditions, Privacy Policy and Cookies before using this site. Please see our Subscription Terms and Conditions.

All material subject to strictly enforced copyright laws. © 2022 Euromoney, a part of the Euromoney Institutional Investor PLC.

Mexico risk to Pacific Alliance’s IG club status

Three-quarters of fund managers that responded to a recent Bank of America Merrill Lynch survey think that Mexico is going to lose its investment grade status.

mexico skulls 780

This prediction is echoed by the bank’s Mexico economist, Carlos Capistran, who thinks that the government is overestimating revenues and economic growth.

Should Mexico lose its investment grade (IG) rating it would be another hit to the region’s faltering economic reputation. Brazil is still a long way from reclaiming its IG status and the other big news story in Latin America – Argentina – is hardly an example of a strong or improving credit environment.

It would also be a worrying sign that the malaise that has hit the southern cone can affect the Pacific Alliance – that group of countries whose economic and financial management orthodoxy was supposed to ensure that membership of this club remained exclusive to those with strong and stable credit ratings.


Sadly, it seems that the fund managers’ prediction could be correct. For only the second time since the Mexican peso was floated, the Mexican current account turned into surplus in the second quarter of 2019. 

And the swing was sharp – from a deficit of 1.3% in the first quarter to a 1.0% surplus. The drivers were sharp contractions in imports for consumption (the country is in a technical recession) and capital goods (which signals lower future growth).

You have reached premium content. Please log in to continue reading.

Read beyond the headlines with Euromoney

For over 50 years, our readers have looked to Euromoney to stay informed about the issues that matter in the international banking and financial markets. Find out more about our different levels of access below.


Unlimited access to and

Expert comment, long reads and in-depth analysis interviews with senior finance professionals

Access the results of our market-leading annual surveys across core financial services

Access the results of our annual awards, including the world-renowned Awards for Excellence

Your print copy of Euromoney magazine delivered monthly

£73.75 per month

Billed Annually


Unlimited access to and, including our top stories, long reads, expert analysis, and the results of our annual surveys and awards

Sign up to any of our newsletters, curated by our editors


Already a user?

We use cookies to provide a personalized site experience.
By continuing to use & browse the site you agree to our Privacy Policy.
I agree