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LATAM FX: Credit Agricole Recommend Long BRL/MXN on Tariffs

LATAM FX
  • In Credit Agricole’s view, current USDMXN levels do not reflect a real possibility that Trump will follow through on implementing tariffs. Punitive tariffs could be short-lived, according to Credit Agricole, however, “there will be a reaction, which lends itself to a tactical trade”
  • They establish a long BRL/MXN trade via a 3-month non-deliverable forward contract with a spot reference level of 3.4950 and a stop loss of 3.4150.
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  • In Credit Agricole’s view, current USDMXN levels do not reflect a real possibility that Trump will follow through on implementing tariffs. Punitive tariffs could be short-lived, according to Credit Agricole, however, “there will be a reaction, which lends itself to a tactical trade”
  • They establish a long BRL/MXN trade via a 3-month non-deliverable forward contract with a spot reference level of 3.4950 and a stop loss of 3.4150.