U.S. officials are visiting Mexico Friday, adding to speculation that the Trump administration may be looking for a victory on another trade front while tensions escalate with China.

"We believe the administration is looking to cut a deal on NAFTA or some deal on zero tariffs for autos," said Dan Clifton, head of policy research at Strategas Research. "We believe that of the two, NAFTA has a better shot at conclusion."

Secretary of State Michael Pompeo will be in Mexico on Friday meeting with the current president and the president-elect of Mexico, Clifton noted. 'It's worth keeping an eye on since so much work has already been done on NAFTA."

Pompeo and White House adviser Jared Kushner, President Donald Trump's son-in-law, are expected to travel to Mexico City to meet incoming president Andres Manuel Lopez Obrador. Treasury Secretary Steven Mnuchin and Homeland Security Secretary Kirstjen Nielsen also will be attending a meeting with Lopez Obrador at his campaign headquarters, according to news reports.

The peso, which has been rising, was up more than 1 percent Thursday and is up about six percent since the July 1 election, as investors bet the administration of Lopez Obrador, a socialist, will be more business friendly than expected. That has also helped the outlook for NAFTA, also as Mexico's Economy Minister Ildefonso Guajardo said Wednesday that he was working out details for a meeting on NAFTA with U.S. Trade Representative Robert Lighthizer for the end of July in Washington. Guajardo is part of the outgoing government, but in comments to Reuters he said his responsibility is to find a solution on NAFTA that works for everyone.

"If there is room before the end of this administration, we will certainly take advantage of the opportunity to conclude [negotiations]," he said. Lopez Obrador takes office on Dec. 1.

"Lozpez Obrador has tried to smooth the concerns of international investors and American companies but he hasn't really discussed much around immigration and security," said Hartasánchez. He said the president-elect has also shown that he will work with the outgoing administration and that he's willing to speak with the U.S., both positives.

"We know Lopez Obrador would want to move forward and modernize NAFTA. It could be a talking point. It's probably being discussed, but I don't see that as the most critical issue on the agenda," said Juan Carlos Hartasánchez, Albright Stonebridge Group senior director. He said security and immigration are likely higher on the agenda.