The Mexican peso strengthens following U.S. inflation data, narrowing its weekly decline.
he exchange rate closed the day at 19.2870 pesos per dollar. Compared to Thursday's rate of 19.4939 pesos.
The Mexican peso surged after the release of data supporting further interest rate cuts by the Federal Reserve.
On Friday, the Mexican peso gained significant ground against the U.S. dollar. The local currency advanced following the release of data that bolstered expectations for additional rate cuts by the Federal Reserve (Fed), sharply reducing its weekly decline.
The exchange rate closed the day at 19.2870 pesos per dollar. Compared to Thursday’s rate of 19.4939 pesos, based on official data from the Bank of Mexico (Banxico), the peso gained 20.69 cents, equivalent to a 1.06% appreciation.
The dollar traded within a range, reaching a high of 19.6210 pesos and a low of 19.2589. The Dollar Index (DXY), which measures the greenback against a basket of six major currencies, edged down 0.065 points to 102.92.
On a weekly basis, the peso, which had depreciated over the past five days due to a combination of risk aversion, technical factors, and economic data, managed to reduce its loss to just 2.83 cents, or 0.15%, from its level of 19.2587 pesos last Friday.
Cooling producer inflation in the world’s largest economy supported the outlook for another Fed rate cut. The possibility of continued rate cuts in the U.S. allowed the local currency to stabilize.
On Wednesday, Mexico released consumer price data, which continued to show a downward trend, while U.S. data on Thursday came in slightly higher than analysts had expected but still showed signs of moderation.
Producer price data also followed comments from Raphael Bostic, president of the Atlanta Federal Reserve, who said he might vote against rate cuts at the November policy meeting if economic conditions warranted it.
The U.S. Producer Price Index (PPI) remained unchanged in September (0.0%), below the expected 0.1% monthly increase and lower than August’s 0.2%. The annual rate came in at 1.8%, above the 1.6% forecast but down from the revised 1.9% in August.
- Check out our free forex signals
- Follow the top economic events on FX Leaders economic calendar
- Trade better, discover more Forex Trading Strategies
- Open a FREE Trading Account
Related Articles
Comments
Sidebar rates
Related Posts
Save
Join 350 000+ traders receiving Free Trading Signals
Alerts
Rates
Calendar
Signals