Investors Ramp Up FX Hedges on Mexico Debt as US Election Looms.

Investors are increasing their foreign exchange hedges on Mexican debt in anticipation of a potential weaker peso if Donald Trump wins the US presidential election. Approximately 36% of investors' exposure to Mexican debt is currently hedged against a weaker peso, which is close to the highs of last year. Concerns about a second Trump administration leading to more friction between the US and its trading partners, including Mexico, are driving this hedging activity. Investors are also being cautious due to the immigration crisis on the border. [Extracted from the article]