The ratings on the United Mexican States are supported by: Growing macroeconomic stability. Low inflation, a flexible exchange rate, and deepening financial markets give Mexico greater ability to adjust to negative shocks. Growing integration with the U.S. economy, as shown by the tight connection between industrial growth in the U.S. and GDP growth in Mexico, contributes to greater stability. That, in turn, sustains investor confidence despite little prospect of structural reform over the near term; An improving debt profile. Monetary stability and growing domestic capital markets (especially pension funds) have facilitated the substitution of domestic for external debt in recent years by both the private and public sectors. More than two-thirds of the central government's debt stock is now in
