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The Mexican stock market and its economy have lagged somewhat on two counts. One of the reasons is the domestic issues surrounding President Andres Manuel Lopez Obrador. The other is Nancy Pelosi’s potential to delay the new Nafta in order to avoid giving President Trump a victory.

One of the easiest ways to access Mexican stocks, the iShares MSCI Mexico (EWW) exchange-traded fund, rose more than 1% on Monday morning, while the rest of emerging markets rose only 0.2% and the S&P 500 is down. That alone shows who the market is willing to reward first once this thing is done.

The Mexican stock market is on the rise because trade negotiators from the United States, Mexico and Canada have reached a final deal on the New Alena, which Trump has renamed the United States-Mexico-Canada Agreement, FOX Business reported. .

A final deal could be reached within the next 24 hours, but Pelosi and some Democrats are stalling. If Pelosi did not take a vote on it, Mexican stocks would sell off again, struggling to keep pace with the rest of the emerging markets index, and its economy would keep on going until 2020.

While the old-fashioned NAFTA deal is still in place, the Mexican economy has not benefited at all from the strength of the US economy. It contracted 0.3% on an annualized basis in the third quarter. Mexico’s GDP also contracted 0.9% on an annualized basis in the second quarter. Mexico is now in a recession. Blocking this trade deal will not improve things for AMLO, whose popularity is waning.

If Pelosi were to put the issue to a floor vote, it is generally expected to pass. It would be the most important and discussed bipartisan bill outside of the sanctions imposed on Russia and China since Trump was elected.

Pelosi has raised concerns about the Mexican auto worker wage, wanting it to average $ 16 an hour depending on the type of work so as not to reduce the wages of American auto workers. AMLO confirmed this morning that the Mexican Senate had accepted labor arbitration panels, a compromise solution to Mexico’s repulsion against on-site enforcement inspections of auto factories.

AFL-CIO President Richard Trumka has said he supports the new deal. The AFL-CIO is in line with Democratic Party policies.

China can ‘pound sand’

Once signed and official, the USMCA would give US agribusiness a boost, much like a recent US-Japan trade deal does.

“The United States now has ‘TPP or better’ levels of access to Canadian and Japanese agricultural markets,” says Brian McCarthy, chief strategist for Macrolens, an investment research firm in Stamford, Connecticut.

The TPP is the Trans-Pacific Partnership, an Obama-era trade deal that was killed immediately after Trump took office.

If Pelosi bite the bullet and give the country – and Wall Street – a chance to put this issue aside, then that would take the pressure off to sign a phase one trade deal with China. Part of the phase one deal includes promises to import more US farm products, namely soybeans. Pelosi is not a fan of China. USMCA eases pressure on Chinese trade.

CNBC host Jim Cramer used his time on Squawk on the Street and his own show, Mad Money, to warn investors that Trump no longer needs a deal with China. Last week, employment figures and wage growth were strong, despite tariffs.

On Monday, he asked why the United States should even bother signing a deal after China allegedly bans all American software from government offices by 2023, the Financial Time reported.

“I think people still believe there’s going to be a deal (with China) because they think it’s rational: ‘Why not make a deal? It’s good for both sides, ”Cramer said this morning. “I think the president is saying more and more, ‘If they continue to not want to make a deal, I’m happy to go.’ So I think that’s the tenor of things right now.

Passing the USMCA makes it less imperative for Trump to achieve yet another trade victory, as Washington clearly believes that Mexico and Canada are larger and more trusted trading partners than China.