Mexico’s private spending rose by 4% year on year in the fourth quarter. This compared with 1.6% in the previous reading.
The latest figure shows faster growth in private spending than before. It indicates an increase of 2.4 percentage points from 1.6% to 4%.
Given today is March 20, 2026, the unexpected strength in Mexico’s private spending is a significant bullish indicator. The 4% year-over-year jump, smashing the 1.6% figure, suggests the Mexican consumer is far more resilient than we anticipated. This forces a re-evaluation of economic growth forecasts for the first half of 2026, especially after Banxico’s cautious tone in last month’s meeting.
We should now consider positioning for a stronger Mexican peso, as this robust domestic demand could lead the central bank to delay any potential rate cuts. The USD/MXN pair, which has been hovering near 17.40, now has a catalyst to break lower toward the 17.00 support level last seen in late 2025. Traders can look at buying May expiration puts on the USD/MXN or selling out-of-the-money call spreads to capitalize on this view with defined risk.
This data also signals a positive outlook for the Mexican equity market, particularly consumer-focused stocks. The iShares MSCI Mexico ETF (EWW) is likely to see upward momentum, breaking out of the range it has been in since January 2026. We believe buying near-term call options on EWW is a direct way to play this renewed confidence in the domestic economy.
Specifically, sectors like retail and banking stand to benefit, mirroring the trend we saw in the third quarter of 2025 when initial signs of consumer strength emerged. Options on companies like Fomento Económico Mexicano (FEMSA) could see increased bullish activity. Recent data from Mexico’s national retail association, ANTAD, showed same-store sales grew by 5.2% in February 2026, which adds further credibility to this spending surge.
However, the primary risk is that this strong data prompts a more aggressive inflation-fighting stance from Banxico than the market is pricing in. Watch for rising implied volatility in Mexican assets, which could make buying options more expensive. We view this as an opportunity to sell put spreads on key Mexican equities, collecting premium while maintaining a bullish-to-neutral stance.
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