Mexico’s credit rating is maintained at ‘BBB’ by S&P, with a stable outlook

Mexico’s long-term foreign currency sovereign debt rating of «BBB» and its local currency rating of «BBBB+,» both with a stable outlook, were confirmed by the rating agency Standard & Poor’s (S&P) on Monday.

In its most recent ruling, S&P clarified that it anticipates «despite low economic growth,» careful monetary policy, and a return to small budget deficits to balance Mexico’s public finances this year.

In order to maintain economic stability, the agency expects Claudia Sheinbaum’s administration to handle disagreements with the US on matters like immigration and trade in a practical manner.

The report warned, however, that a delay in containing the fiscal deficit or greater extraordinary support for Petróleos Mexicanos (Pemex) and the Federal Electricity Commission (CFE) could lead to a downgrade in the next two years.

On the other hand, if the country manages to attract more foreign investment through nearshoring, strengthen its budgetary flexibility, and broaden its tax base, the ratings could improve.

The rating agency emphasized that Mexico has stable institutions, an independent central bank, and growing capital markets that strengthen its monetary flexibility.