Recently, I was reviewing how the USD/MXN has moved throughout 2025, and honestly, the pair has been a roller coaster. When the dollar rises like it did this year, you have to understand that it’s no coincidence; there are very specific factors behind it.

This pair compares the US dollar against the Mexican peso, and the volatility we've seen reflects exactly the tensions between both economies. At the beginning of the year, political uncertainty in the United States and protectionist policies created constant pressure on the peso. When the dollar rises this way, it generally means investors are seeking refuge in safer assets, leaving emerging currencies aside.

What’s interesting is that in Mexico, we face a complicated situation. Inflation remained above what the Bank of Mexico aimed for, which forced interest rate cuts. That further weakened the peso because yields in pesos became less attractive. Meanwhile, the Federal Reserve also lowered rates but kept its yields more competitive than Mexico’s. When the dollar rises under these conditions, it’s almost inevitable.

Technical data during 2025 showed that the pair fluctuated quite a bit. Some analysts predicted levels of 23 or even 25 pesos per dollar by the end of the year, others were more conservative. The reality was more nuanced, with the pair oscillating within ranges that reflected each economic or political news. Every announcement from Banxico or the Federal Reserve moved the market significantly.

One factor many underestimated was Mexico’s dependence on oil prices. When the dollar rises, demand for commodities priced in dollars typically drops, which puts more pressure on the Mexican economy. This creates a cycle where the peso loses additional value.

From a technical perspective, the pair went through phases of consolidation and bullish breakouts. Resistance levels at 20 pesos were key for several months. When they finally broke sustainably, momentum continued upward. Volatility indicators showed that this was not random movement but structural pressure.

What we learned from 2025 is that when the dollar rises persistently, you need to look beyond the charts. Monetary policy decisions, political events, and the health of foreign trade are the real drivers. For those trading this pair, opportunities came from identifying these breaking points before the market moved.

If you’re following this pair now, it’s worth keeping in mind that the dynamic between both currencies remains complex. Rate cuts in Mexico continue to be a weakening factor for the peso. Any additional strengthening of the dollar would probably come from inflation surprises in the United States or changes in trade policy.

For those wanting to follow these movements closely, platforms like Gate offer access to analysis and real-time data of the pair. It’s worth paying attention to economic calendars and maintaining well-managed positions given the volatility characteristic of USD/MXN.