Two-Year Cetes Maintain Their Strength Against Banxico's Interest Rate Cut

Despite the fact that the Bank of Mexico (Banxico) lowered its reference rate, the yields on long-term Cetes stood out as the most attractive option for investors this week. Last week, Banxico enacted a 50 basis point cut, bringing the interest rate down to 8.50%, and suggested that similar cuts might be on the horizon.

Intercam, in a report, noted that "a cut of that magnitude is expected at the scheduled meeting in June." Since last year, the yields on Cetes have declined from their historically high double-digit rates due to the drop in Banxico's rate.

What is the yield rate on Cetes? For the 28-day Cetes, the rate reached its lowest point since August 2022, at 8.15%. For the 81-day Cetes, the rate was 8.24%, and for the 175-day Cetes, it was 8.16%. For the two-year segment, the yield rate hovers around 8.55%.

In an environment where interest rates are falling, investors should consider diversifying their assets to mitigate risks. While Cetes remain a quite attractive option, it’s essential to stay informed about market trends and adopt a strategy that aligns with long-term financial goals.