Mexican Peso Slips as U.S. Shutdown Fears Shake Markets
Investors are awaiting the release of the Fed’s latest meeting minutes on Wednesday, following a 25-basis-point rate cut.
Quick overview
- The Mexican peso weakened against the U.S. dollar, closing at 18.3945 pesos per dollar amid a global strengthening of the greenback.
- The U.S. government shutdown has delayed key economic indicators, increasing uncertainty in the markets.
- Investors are closely monitoring upcoming Fed meeting minutes and inflation data from Mexico, as local indicators gain importance.
- The day's trading reflected cautious sentiment and heightened hedging activity due to global trade tensions.
The Mexican peso weakened against the U.S. dollar on Tuesday as the greenback strengthened globally amid growing uncertainty over the partial shutdown of the U.S. federal government, now in its seventh day.
The exchange rate closed at 18.3945 pesos per dollar, compared with Monday’s official close of 18.3474, marking a 0.27% decline, or 4.71 centavos, according to data from the Bank of Mexico (Banxico).
During the session, the dollar traded between a high of 18.4158 and a low of 18.3323 pesos. The U.S. Dollar Index (DXY)—which tracks the currency against a basket of six major peers—rose 0.48% to 98.59 points.
The U.S. government shutdown has halted the release of key economic indicators, including the nonfarm payrolls report, a crucial reference for Federal Reserve policy decisions.
Investors are awaiting the release of the Fed’s latest meeting minutes on Wednesday, following a 25-basis-point rate cut. On Tuesday, Fed Governor Stephen Miran said the bond market’s stability supports an “aggressive” easing approach.
In Mexico, traders are watching for inflation data and Banxico’s meeting minutes on Thursday. With limited data coming from the U.S. due to the shutdown, local indicators are taking on added importance.
The day’s movements reflected a cautious tone and increased hedging activity, amid global trade tensions and anticipation of fresh inflation and monetary policy signals from Banxico.
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