Citi survey: 2026 exchange rate seen at MXN18.20 vs DLR

Citi survey: 2026 exchange rate seen at MXN18.20 vs DLR

Citi Survey: 2026 Exchange Rate Seen at MXN18.20 vs. USD

The latest Citi Mexico Expectations Survey indicates growing confidence among financial institutions that the Mexican peso will stabilize against the U.S. dollar in 2026. As of February 4, 2026, the median forecast for the USD/MXN exchange rate at year-end stands at 18.35, reflecting a slight improvement from the previous survey's 18.75 estimate according to the survey. This suggests a consensus view that the peso will strengthen modestly, though forecasts remain wide-ranging, from 17.10 to 20.30 as reported. For 2027, the median expectation is 19.00, indicating further depreciation compared to 2026 levels according to the survey.

The peso's trajectory is influenced by broader economic expectations. Mexico's GDP growth is projected to reach 1.4% in 2026, up from 1.3% in the prior survey, with forecasts ranging from 0.6% to 1.8% according to the survey. This aligns with the federal Finance Ministry's more optimistic 1.8%-2.8% target, though the consensus remains below that range. For 2027, growth is expected to hold steady at 1.8% according to the survey.

Inflation expectations also shape the outlook. The median forecast for year-end 2026 headline inflation is 4.0%, slightly above the Bank of Mexico's 3% target, with core inflation at 4.1% according to the survey. These figures reflect cautious optimism that inflationary pressures will ease but not fully resolve.

Monetary policy expectations are similarly key. The Bank of Mexico (Banxico) is anticipated to cut its benchmark interest rate by 25 basis points in May 2026, with the policy rate projected to settle at 6.50% by year-end 2026 and 2027 according to the survey. This aligns with 34 of 35 survey respondents expecting at least one rate cut in 2026, though Santander México is the sole outlier predicting no change as reported.

The peso's performance in 2025—ending the year at 18.00 after a strong appreciation—has tempered expectations for 2026. However, analysts note that external factors, including U.S. monetary policy and global trade dynamics, will remain critical drivers according to analysis.

Overall, the survey underscores a balanced outlook: moderate growth, controlled inflation, and gradual monetary easing, with the peso's trajectory reflecting both domestic and international economic currents.

Source: Citi Mexico Expectations Survey (Feb 4, 2026)
Source: Mexico News Daily (Feb 2026)