Analysis on the Possibility of Investment in the Mexican Emerging Market

Abstract

Emerging markets with high uncertainty and turbulent environments are always hard to predict. Unlike advanced markets that are not easy to be influenced by the external environment, emerging markets are still immature and likely to be easily affected. The Mexican peso crisis in 1994 is an example that inappropriate monetary policy was taken when the entire financial system was weak in Mexico at that time. In the global emerging market, Mexican peso plays a significant role in maintaining the stability of the foreign exchange market. This paper aims to analyze the current situation of Mexican domestic emerging markets from its economy, the monetary policy of the central bank of Mexico, and foreign exchange aspects. The analysis can provide information for potential investors to make a decision before they decide to invest in the Mexican emerging markets.