Mexico’s credit risk is at the highest level since the days after Donald Trump’s inauguration. Five-year credit-default swaps that hedge against a drop in the value of Mexico’s sovereign debt have soared as the July 1 presidential election nears, Bloomberg News reported. Leftist Andres Manuel Lopez Obrador holds a commanding lead in the polls, and traders are concerned his victory could upend the economy just as the country is roiled by increasing trade tensions with the U.S. Other Mexican assets are also showing signs of stress as the election approaches.

The Mexican peso sank to its weakest in more than a year on concern the U.S. may leave the Nafta agreement and try to negotiate two separate free-trade deals with Mexico and Canada, Bloomberg News reported. The currency slid for a fourth day, dropping 1.6 percent to 20.4031 per dollar as of 3:46 p.m. in New York, the second-sharpest retreat among major peers. The cost of insuring Mexican bonds in the credit-default swaps market for five years surged nine basis points to 146.501, climbing for a ninth day in the longest streak since June 2013. Stocks halted a two-day rally.

The head of a Mexican congressional committee on Tuesday called for an investigation of an investment by state workers’ pension fund PensionIssste, after Reuters reported it spent millions on shares in a company spiraling toward bankruptcy, Reuters reported. PensionIssste spent around 400 million pesos ($21.5 million) buying the largest stake in builder ICA (ICA.MX), even after its shares had fallen by more than half in the previous year, three people with knowledge of the investment told Reuters. It stands to lose almost all its investment in a restructuring.

Mexico's state workers' pension fund plowed more than $20 million into ICA and became the largest shareholder as the builder spiraled toward insolvency, according to people familiar with the matter, with the fund's investment set to be wiped out in a restructuring, the International New York Times reported on a Reuters story.

Mexican construction company ICA said on Monday that a judge had approved its creditors agreement, ending the group’s bankruptcy proceedings, Reuters reported. ICA suspended debt payments at the end of 2015 after a crash in the peso made its dollar-denominated debt load unbearable. The company entered into bankruptcy proceedings in September last year. Read more.

Deal making by Mexican companies declined for the second year in a row in 2017 on concerns about the future of free trade with the U.S. and uncertainty related to next year’s presidential elections, the Wall Street Journal reported. Mergers and acquisitions involving Mexican companies and assets totaled $23.7 billion in dollar terms, a decrease of 5 percent from 2016, according to data compiled by Dealogic. There were 230 transactions in 2017, compared with 241 the year before. “The main reason is the significant uncertainty related to the economy and free trade.

Mexican construction company ICA said late on Friday it and its subsidiaries had filed a pre-packaged bankruptcy plan that had been subscribed to by the majority of its creditors, Reuters reported. ICA, which has been struggling under a high dollar-denominated debt load, said the plan had been filed in accordance with the statutes of Mexican bankruptcy law. Read more.

Mexico’s economy faces “sizable” risks as the U.S. considers renegotiation of the Nafta free-trade agreement and other protectionist policies, the Organisation for Economic Cooperation and Development said in a report. Latin America’s second-largest economy has so far proved itself resilient to the rhetoric of Donald Trump, who assumed the presidency in January promising to rewrite the trade deal, Bloomberg News reported. The Mexican peso has recovered recent losses and now trades at levels seen before the U.S. election.

When President Enrique Peña Nieto called Donald Trump and persuaded him not to scrap the North American Free Trade Agreement on his 100th day in office, it was a reminder that Mexico has not lost its touch in managing international crises. Debt default, devaluation, hyperinflation and bank nationalisations — Mexico has coped with them all in the past four decades, the Financial Times reported. As Mr Trump was building his business empire, officials in Latin America’s second-biggest economy were cutting their teeth on catastrophe.

The Bank of Mexico stepped into the exchange market Thursday for the first time in almost a year to support the peso, which hit new lows against the U.S. dollar on fears that protectionist measures by the incoming administration of U.S. President-elect Donald Trump could hurt the country’s trade and investment, The Wall Street Journal reported. The foreign-exchange commission, formed by central bank and Finance Ministry officials, said the dollar sales were to provide liquidity and ease the exchange volatility of recent days, and kept open the possibility of additional interventions.