Mexican Peso Closes Higher for Fourth Straight Day After Banxico Rate Cut

Consumer price inflation in Mexico slowed during the first half of June, reaching 4.51% year-over-year, down from 4.62% in May.

Written by: Ignacio Teson • Thursday, June 26, 2025 • 1 min read

• Last updated: Thursday, June 26, 2025

Quick overview

The Mexican peso strengthened against the U.S. dollar for the fourth consecutive session, closing at 18.8623 pesos per dollar.
This rally followed a 50-basis-point interest rate cut by the Bank of Mexico, bringing the benchmark rate down to 8%.
Consumer price inflation in Mexico slowed to 4.51% year-over-year, while the U.S. showed mixed economic signals with a drop in GDP and lower jobless claims.
The peso's gains were also supported by improved market sentiment after a ceasefire between Israel and Iran.

The Mexican peso strengthened against the U.S. dollar on Thursday, marking its fourth consecutive session of gains. The rally came on the back of a 50-basis-point interest rate cut by the Bank of Mexico (Banxico) and amid mixed economic signals from the United States.

The exchange rate closed the session at 18.8623 pesos per dollar, compared to 18.9244 in the previous session, according to official data from Banxico. That represents a gain of 6.21 centavos, or 0.33%.

During the day, the dollar traded in a range between a high of 18.9400 and a low of 18.8471 pesos. Meanwhile, the U.S. Dollar Index (DXY), which measures the greenback against a basket of six major currencies, fell 0.41% to 97.30 points.

Banxico announced its fourth consecutive 50-basis-point cut to the benchmark interest rate, bringing it down to 8%, the lowest level since 2022. The central bank signaled that it would evaluate further rate cuts moving forward, taking into account inflationary pressures.

USD/MXN

Macoeconomic Data Impacting the Mexican Peso

Consumer price inflation in Mexico slowed during the first half of June, reaching 4.51% year-over-year, down from 4.62% in the second half of May. However, inflation remains above the official target of 3%, plus or minus one percentage point.

In the U.S., new data showed a sharper-than-expected drop in first-quarter GDP. Separately, initial jobless claims came in below forecasts, adding to the mixed economic picture.

The peso’s gains also reflected improved market sentiment following a ceasefire between Israel and Iran. Over the four-day rally, the currency has strengthened by 30.60 centavos, or 1.60%, from Friday’s close of 19.1683 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.