Emerging market currencies may have been tanking across the board recently as fears of a scaling back of U.S. Federal Reserve bond purchases add to concerns over a slowdown in China, but analysts have handpicked one Latin American currency that could receive a boost on Wednesday's Fed announcement.
"The Mexican peso will perhaps perform a little," Anders Eklof, a currency strategist at Swedbank told CNBC Wednesday looking ahead to the keenly-awaited policy statement by the Federal Reserve as it wraps up a two-day meeting at 7 p.m. London time on Wednesday.
(Read More: Why Emerging Markets Are Still on Shaky Ground)
"Some of the EM (emerging markets) currencies that have been sold off so heavily, perhaps (they) can come back a little bit...but uncertainty will prevail."
Emerging market currencies have seen massive outflows in recent weeks, with concerns that reduced liquidity from the Fed will hit riskier assets and boost safer assets like the dollar. The Mexican peso has depreciated nearly 8 percent against the dollar since mid-May, the South African rand nearly 12 percent and the Brazilian real nearly 9 percent. Meanwhile perceived safe-havens like the Swiss franc and the Japanese yen have remained fairly strong.
"[The Mexican peso] benefits from the mutual exclusiveness of its growth prospects (which are dependent on the U.S.'s) and the risk from the prospective Fed exit," currency analysts at Societe Generale said in a research note on Wednesday.
(Read More: Why the Emerging Market Bull Run Is Over)
Mexico's current account deficit has been relatively robust compared to other emerging markets, SocGen said. The recent episodes related to Fed exit concerns show countries with larger current account deficits are susceptible to Fed moves (for example – India, Turkey, South Africa, Indonesia and Brazil) and their currencies could deteriorate further before stabilizing, SocGen said.