Mexico's Financial System Stability Council published an updated assessment of risks to financial stability following its 59th ordinary session, concluding that the Mexican financial system remains solid and resilient despite a more uncertain global environment. The Council highlighted slower and more uncertain global growth, persistent volatility tied to trade and geopolitical tensions, and uncertainty over the path of global monetary policy, noting in particular that the US Federal Reserve kept its policy rate unchanged at 4.25 to 4.5 percent in its January and March meetings. For Mexico, it reported that local financial markets were relatively more stable than international markets, with the peso depreciating by around 1 percent while government bond yields declined across maturities. It also pointed to signs that late-2024 domestic activity weakness may have extended into early 2025 and noted that Mexico’s sovereign rating remains investment grade, with some agencies flagging US trade protectionism and related uncertainty as challenges. On the resilience of intermediaries, commercial banks were described as holding capital and liquidity comfortably above minimum regulatory requirements, while vulnerabilities in some non-bank financial intermediaries were not seen as systemic given their limited share and banks’ exposure to them; the Council also reviewed rising foreign holdings of peso-denominated assets in 2025 and judged the associated risks to be contained. The Council approved the near-term publication of its 15th annual report on financial system stability and Council activities, which includes stress test results showing a strong position for regulated intermediaries, particularly banks. It will continue monitoring developments and, if necessary, take actions within its mandates to support market functioning and safeguard financial stability.
Central Bank of Mexico 2025-03-28
Mexico's Financial System Stability Council updates risk balance and approves publication of its 15th annual financial stability report
Mexico's Financial System Stability Council assessed the financial system as solid and resilient despite global uncertainties, highlighting stable local markets and strong bank capital and liquidity. The Council noted slower global growth, trade tensions, and unchanged US Federal Reserve rates, while Mexican government bond yields declined and the peso depreciated slightly. It plans to publish its 15th annual report, including stress test results, and will monitor developments to ensure stability.