EMI Templeton Reports

COVID – Mexico

One storm, different boats

June Report 2020

Globally, risky assets continued their April upswing due to opening up of economies despite different stages of the pandemic and healthcare capacities. Mexico specifically followed the global trend with risk assets recovering but braked by continued uncertainty over pandemic management and  the economic consequences.

Students in China return to school after restrictions are lifted.

Reopening: how, when, V, U, W, L?

May Report 2020

On a global level, after a very bad March, risky assets recovered in April, with some economies reopening, and more reopening in May.  Mexico followed the global trend with a recovery in risk assets. But it was braked by the perception that the government has no concrete plan for the pandemic or economic reopening.

Health Workers in Mexico

Pandemic Shutdown: Economic Coma

April Report 2020

COVID19 ended the longest expansion since WWII, affecting investments drastically in 1Q20. Globally and locally,the crisis(and investments)will depend on the virus and on health,monetary and fiscal policies. In Mexico, COVID19’s effect on investments was amplified by peso depreciation and the government’s late and confused reaction. AMLO approval at lowest level of presidency.

Decorative image - shows strain of COVID-19 Virus (according to CNN)


March Report 2020

Global markets are volatile due to coronavirus. Lower rates by central banks do not
alleviate fears of slowdown, due to global demand and supply shocks. In Mexico, markets and economy aggravated by global contagion. Approval of AMLO declines due to feminicides, insecurity and healthcare system crisis. Global risks include coronavirus, overindebtedness, trade wars, geopolitics, Brexit/Europe, and US elections.


Mexico: Sustainable Stagnation

February Report 2020

In Global news, markets have continued the positive trend of 2019 but have been impacted by
the coronavirus. In Mexico, markets are in line with global trend, with the economy stable but stagnant, owing to government policies and insecurity. Read more here!

Unchartered Territorty

Unchartered Territory

January Report 2020

2019 positive for markets, despite political and economic risks. For 2020, with record debt levels, and the longest postwar recovery, uncharted territory.


Will 2020 be better?

December Report 2019

In Global News, 2019 ends with a dispute with China unresolved, a possible Trump impeachment possible, and Brexit subject to elections in December. Rate cuts are  paused and markets are still strong. In Mexico, 2019 was a bad year for economy and security. USMCA difficult for 2019. The AMLO’s
popularity is falling. Short term rates to fall but markets are still firm


Deinstitutionalization and Deceleration

October Report 2019

Global slowdown and trade dispute under negotiation. Oil prices in new normal. Likely short/medium-term rate cuts. TMEC possible in 2019. Growth 2020 greater than 2019. Insecurity continues to deteriorate. Expectations of more rate cuts by Banxico. Global risks: sharp slowdown, trade wars, geopolitics, Brexit/Europe, monetary policy, emerging markets.


Trade Disputes and Monetary Uncertainity

September Report 2019

Bad month for risk assets due to renewed US-Chinese trade wars. Mexico, Bank of Mexico easing positive for stocks and debt. Global risks 2019-20: sudden slowdown, trade wars, geopolitics, Brexit/Europe, monetary policy, emerging markets. Local risks: dysfunciontal government, nonratification USMCA in US, investment downgrade.


Global Watershed and Local Decoupling

August 2019 Report

Global. Risk assets rose during July due to expected lower rates, but August began with renewed US-China trade disputes. Mexico. Negative economic data and estimates, Pemex business plan, and anti-constitutional legal initiative damaged risk assets.


Markets vs. Global Cycle, Local Dissonance

July Report 2019

Risk assets rise, due to positive trade outcome from G20 meeting in Japan, positive central bank tone, and continued OPEC cut. Risk assets rise due to resolution of tariff dispute with US, local ratification of USMCA, and strong peso due to interest rate differential.

Dissonance: markets vs. economy

Dissonance: markets vs. economy

April Report 2019

Globally, risks assets have recovered owing to a weaker slowdown and more dovish monetary policy. In Mexico, risk perception has increased owing to more clear government policies, including centralization of power and redistributive social spending, reflecting the government’s emphasis on politics over economics.

AMLO: popularity vs. reality

AMLO: popularity vs. reality

March Report 2019

After the first 100 days, AMLO popularity tops 83%, reflecting his clear separation of politics from economics. The US deals with dysfunctional government, non-ratification of the USMCA and frontier wall dispute could cause a Fitch downgrade.

First two months: under the volcano

First two months: under the volcano

February Report 2019

Globally, Synchronized slowdown. US: government shutdown. China-US: improved trade outlook. EU: Brexit uncertainty, Emerging Markets (EM): mixed. Mexico local risks: dysfunctional government, non-ratification USMCA in US, lowered credit rating.

AMLO: populism vs. pragmatism

AMLO: populism vs. pragmatism

December Report 2018

Globally, best investments in 2018 (measured in pesos): Cetes, S&P, US$ and Treasuries. Rate rises indicate end of cycle, oil price down on year. Brexit concerns, but trade war risk fading. In Mexico, after airport cancellation, initial measures by AMLO cause concern. Global risks in 2019, economic cycle and rates, trade wars, geopolítics, Brexit, monetary policy, emerging markets (EM).

USMCA: late cycle or end of cycle?

USMCA: late cycle or end of cycle?

October Report 2018

Globally,positive investments (in peso terms) in 2018: Mexican, oil and S&P, owing to economic cycle doubts, geopolitics, trade wars, rate rises, and emerging markets (EM). NAFTA was renegotiated at the last minute and renamed USMCA.

Will emerging market cycle affect Mexico?

Will emerging market cycle affect Mexico?

September Report 2018

Globally, investments investments affected by rate hikes, trade disputes, and emerging markets (EM) contagion. In Mexico, investments positively affected by US trade agreement, negatively by Canada exclusion and negotiations.

Hyperactive transition: mixed signals

Hyperactive transition: mixed signals

August Report 2018

Globally, investments negative owing to US rate hikes, trade disputes, and problems in Europe. In Mexico, investments positive owing to NAFTA speedup, and mixed presidential transition.

Landslide: hope vs. experience

Landslide: hope vs. experience

July Report 2018

Globally, investments negative due to US rate increases, trade disputes, and problems in Europe. In Mexico, investments positive due to landslide and postelectoral reconciliation.

Indignation and uncertainty

Indignation and uncertainty

May Report 2018

US rate increases strengthened the US$ and lower production raised oil prices. Trade negotiations continue with China. The outlook for Korea seems better, and, for Iran, worse.

Monthly Perspective April 2018.v2

Campaigns: on your mark, get set, go?

April Report 2018

Globally, fears of a trade war have combined with concerns about the economic cycle (inflation and rates), affecting markets.

Two Shocks

Two Shocks

March Report 2018

March, Trump’s announcement of tariffs on steel and aluminum, followed by the resignation of Cohn, his economic advisor, revived trade war fears.

2018: Some Clouds

2018: Some Clouds

February Report 2018

Mexico faces abnormal, extreme risks. NAFTA renegotiation can be postponed owing to non-resolution of key issues, and the left leads in electoral polls.

Crystal ball with

Outlook 2018: looking at the abyss

December Report 2017

In Mexico, in spite of NAFTA renegotiations and a difficult election outlook for 2018, growth and investments have underperformed globally, but still been positive.