The Mexican Peso Regains Ground after Dropping More than 4% in Three Days

The peso had lost ground over the past three sessions, largely due to concerns surrounding Trump's election victory.

Written by: Ignacio Teson • Wednesday, November 13, 2024 • 1 min read

• Last updated: Wednesday, November 13, 2024

The local currency is benefiting from a weaker dollar following the release of U.S. inflation figures that aligned with expectations.

The Mexican peso regained ground on Wednesday morning after experiencing three consecutive days of losses. The recovery comes as the dollar weakened in response to U.S. inflation data that matched forecasts.

The spot exchange rate stands at 20.5391 pesos per dollar. Compared to yesterday’s official close of 20.6702, according to data from the Bank of Mexico (Banxico), this represents a gain of 13.11 cents for the peso, equivalent to a 0.63% increase.

The dollar is trading within a range, hitting a high of 20.6384 pesos and a low of 20.4331 pesos. Meanwhile, the U.S. Dollar Index (DXY), which measures the greenback against a basket of six major currencies, was down 0.10% at 105.92 points.

Inflation in the United States increased as expected in October, with the Consumer Price Index rising by 0.2% for the fourth consecutive month. On a year-over-year basis, it advanced 2.6% through October, following a 2.4% increase in September, according to the Bureau of Labor Statistics.

USD/MXN

Investors are closely monitoring the future of U.S. monetary policy, as the moderation of inflationary pressures toward the Federal Reserve’s (Fed) target has slowed, though it hasn’t yet shifted expectations regarding potential interest rate cuts.

Today, the peso is showing some stability after consecutive sessions of gains, bolstered by the recent weakening of the dollar. However, caution prevails due to the cabinet appointments of U.S. President-elect Donald Trump.

The peso had lost ground over the past three sessions, largely due to concerns surrounding Trump’s election victory and its potential impact on the economy. During that period, the currency declined by 4.25%, falling from 19.8277 to 20.6702 pesos per dollar.

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ABOUT THE AUTHOR See More

Ignacio Teson

Economist and Financial Analyst

Ignacio Teson is an Economist and Financial Analyst. He has more than 7 years of experience in emerging markets. He worked as an analyst and market operator at brokerage firms in Argentina and Spain.