USD/MXN, or the US dollar to the Mexican Peso, is among the top ten traded currency pairs in the global forex market. Trading the most popular currency, the USD, against the most traded currency from Latin America, USD/MXN enjoys high liquidity, offering ample opportunities for forex traders to generate profits. The MXN is an interesting choice for traders looking for carry trading opportunities, owing to its high yielding nature.The exchange rate of USD/MXN is affected by the release of key economic data, such as GDP, trade balance, consumer confidence, business sentiment, inflation and employment reports. In addition, whenever the central banks - the Federal Reserve and the Banco de Mexico, make changes to their monetary policies or interest rates, it impacts the value of the USD and the MXN and drives movement in this forex pair.The US is one of Mexico's most important trade partners, and as a result, any changes in the trade policy of the US, such as the announcement of tariffs, can also cause drive volatility in USD/MXN. Political developments in the US also cause significant fluctuations to the value of the MXN as the Mexican economy is heavily dependent on the US.