Mexican Peso Strengthens Against the Dollar, Capping a Week of Gains
The U.S. Dollar Index (DXY), which measures the greenback against a basket of six major currencies, inched up 0.04% to 98.41 points.
Quick overview
- The Mexican peso strengthened against the U.S. dollar, closing at 18.3899 pesos per dollar, a gain of 0.23%.
- U.S. President Trump indicated that the proposed 100% tariff on Chinese goods is unsustainable while blaming China for stalled trade negotiations.
- Markets are anticipating a potential rate cut by the Federal Reserve at the upcoming meeting on October 29.
- Analysts expect the peso to trade within a range of 18.34 to 18.47 pesos per dollar as they await clarity on tariffs.
The Mexican peso strengthened against the U.S. dollar in the final session of the week, supported by a market that continued to weigh the risks from U.S.–China trade tensions and the prospect of further rate cuts by the Federal Reserve.
The exchange rate closed at 18.3899 pesos per dollar. Compared to Thursday’s official Banxico close of 18.4318, the move represented a gain of 4.19 centavos, or 0.23%.
During the session, the dollar traded between a high of 18.5528 and a low of 18.3648 pesos. The U.S. Dollar Index (DXY), which measures the greenback against a basket of six major currencies, inched up 0.04% to 98.41 points.
U.S. President Donald Trump said his proposed additional 100% tariff on Chinese goods is unsustainable, but blamed Beijing for the stalled trade negotiations, which began after the U.S. imposed tighter controls on rare earth exports.
Trump also confirmed in an interview with Fox Business on Friday that he will meet Chinese President Xi Jinping in two weeks in South Korea—a meeting he had cast doubt on last week—and even expressed admiration for the Chinese leader.
Market Projections – Mexican Peso
Meanwhile, markets continue to price in the possibility of another Fed rate cut at the October 29 meeting. St. Louis Fed President Alberto Musalem said he is currently inclined to support a reduction at the upcoming policy decision.
Looking ahead to the overnight session, analysts expect a trading range of 18.34 to 18.47 pesos per dollar, citing lower risk aversion and the peso’s resilience as investors await greater clarity on tariffs over the weekend.
The dollar’s weakness over the week provided moderate support to the peso. Today’s close, compared to 18.5424 pesos per dollar last Friday, left the local currency with an accumulated gain of 15.25 centavos, or 0.82%.
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