The Mexican Peso Closes Below 18 Units Per Dollar
The Mexican Peso appreciated, supported by inflation data in the first half of June that bolstered expectations that Banxico’s interest rates will remain stable.
The Mexican Peso broke below the 18 units per dollar mark at the start of this week. The currency appreciated, supported by inflation data in the first half of June that reinforced expectations that interest rates will remain stable this Thursday.
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The exchange rate closed the day at 17.9705 units per dollar. Compared to Friday’s close of 18.1171, according to official data from the Bank of Mexico (Banxico), this movement represented a gain of 14.66 cents or 0.81% for the Peso.
The dollar’s price ranged between a high of 18.1515 pesos and a low of 17.8743 units. The Dollar Index (DXY) from the Intercontinental Exchange, which measures the greenback against six currencies, fell by 0.31% to 105.47 points at the close.
The consumer price index in the first half of June increased to 4.78%, higher than the 4.59% recorded in the second half of May. Core inflation rose to 4.17%, reported the National Institute of Statistics and Geography (Inegi).
Inflation in the first half of June was 0.21%, above market expectations. The figures are mixed and keep the balance of inflationary risks tilted to the upside
The Peso weakened significantly in the days following the June 2 elections, in which Morena and its allies secured a majority in Congress necessary to easily push through constitutional reforms.
Days after the election victory, the exchange rate reached a high of nearly 19 units, from which it has since recovered 1.02 pesos or 5.42%. However, it is still down 1.00 pesos or 5.91% from the pre-election close of 16.9666.
The downward trend may continue to dominate for the remainder of the year. The support level to watch for an optimistic scenario is 17.30 per dollar. The Mexican Peso begins the week with gains, breaking through the 18-unit mark. Local traders will be closely watching Banxico’s monetary policy decision on Thursday.
Read More: The Mexican Peso Closes Below 18 Units Per Dollar
2024-06-25 03:11:53