US-Mexico security cooperation centers on counter-cartel operations amid ongoing fentanyl trafficking and border enforcement, with the Trump administration designating additional groups as foreign terrorist organizations and conducting maritime interdictions in international waters. Mexican President Claudia Sheinbaum has repeatedly rejected any US military presence or strikes on Mexican territory, insisting on sovereignty-respecting bilateral efforts focused on intelligence sharing and joint planning without subordination. Recent developments include US troop deployments along the Texas border following reported incidents, Mexican special forces raids aided by DEA intelligence, and tariff threats tied to migration control, while no US-initiated aerial, drone, or missile strikes have occurred on Mexican soil. These dynamics, combined with Mexico's internal anti-cartel measures and diplomatic emphasis on non-intervention, shape trader assessments of escalation risks through year-end.