MXPE Weekly Essentials

Mexico’s Trump cards, less private energy investment, fear of a falling peso, and other highlights in Mexican politics, policy, and markets from the past week.

The media has made it seem like US-Mexico relations will be irretrievably thrown into disarray with Trump’s return to the White House. With the review of the US-Mexico-Canada Agreement (USMCA) coming up in 2026, reports of the return of Robert Lighthizer as the US’s protectionist Trade Chief have spooked markets. So has Trump’s desire to deploy US forces to deal with drug cartels and his threat to impose blanket tariffs on imports—starting at 25%—if Mexico doesn’t reduce the flow of migrants. 

These are worrying signs, but it doesn't help to paint Trump as a caricature when experience has shown him to be a quintessentially transactional figure. These worries also paper over Mexico’s recent and long-term difficulties with Democrat administrations. A proper look at the three main bilateral issues can demonstrate what about Trump’s return should actually worry, and even cheer up, watchers of this relationship: