Currency traders are getting ready for significant volatility in the Mexican peso in light of the upcoming US election, where the outcome is uncertain between Kamala Harris and Donald Trump.
The peso's one-month implied volatility has reached its highest level since April 2020, surging above 22.43%, according to Bloomberg data. The peso has already experienced a 15% decline this year, making it one of the most vulnerable emerging-market currencies. Analysts caution that if Trump were to impose strict tariffs, the peso could face even greater difficulties.
Market participants are closely watching the election results, expecting potential significant shifts in currency value.