Mexican Peso Extends Recovery Ahead of U.S. Jobs Data
The Mexican peso extended its recovery against the U.S. dollar on Thursday, supported by a global weakening of the greenback ahead of the U.S. nonfarm payrolls report set to be released on Friday.
The exchange rate closed at 20.2043 pesos per dollar, compared to Wednesday’s 20.3001, marking a gain of 9.58 cents or 0.47%, according to data from the Bank of Mexico (Banxico). During the session, the peso traded between a high of 20.3185 and a low of 20.1621.
The U.S. Dollar Index (DXY), which measures the greenback against a basket of six major currencies, fell 0.57% to 105.72, contributing to the USD/MXN appreciation.
A modest increase in initial U.S. unemployment claims last week also pressured the dollar, as it bolstered expectations that the Federal Reserve might cut its benchmark rate at its December 18 meeting.
Mexican Peso Outlook
Attention now turns to the November U.S. nonfarm payrolls report, which is forecast to show the creation of 215,000 jobs and an unemployment rate of 4.1%. The data is expected to provide insight into the future trajectory of interest rates, following Federal Reserve Chair Jerome Powell’s optimistic assessment of the U.S. economy earlier this week.
The peso’s recent strength reflects a broader trend of dollar weakness, as markets anticipate a potential shift in monetary policy from the Fed.
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