The USD/MXN is reacting to potential actions by the Mexican central bank, commonly known as Banxico. Like other emerging market central banks, the bank has embraced a relatively hawkish tone as officials attempt to battle the rising inflation.Â It has delivered two straight rate hikes in a bid to deal with the soaring inflation that stands at 7%. They have hiked rates by 200 basis points since last year. Other banks like those in Brazil and South Africa have also hiked rates.