Mexican peso depreciates after marking a new low of almost three years

The Mexican peso it depreciated in the operations of this Wednesday. The local currency withdrew in a rejection of the price for opportunity purchases in dollars after the cross marked a new minimum of almost three years at the level of 18.5665 units.

The exchange rate ended this session at the level of 18.8493 units against the close of 18.6864 units per dollar yesterday, with official data from the Bank of Mexico (Banxico). That meant for the currency a depreciation of 16.29 cents or 0.87 percent.

The pair operated in an open range with a maximum of 18.8601 units, which it touched after marking an early minimum of 18.5665 pesos. The Dollar Index (DXY), which measures the greenback with the other six G7 currencies, rose 0.03% to 102.42 units at the close.

The operations early brought the exchange rate to a new low not seen since February 2020, almost three years, amid a weakening of the dollar due to the drop in the number of retail sales and producer prices in the United States.

The new figures supported bets that the Federal Reserve (Fed) could slow down interest rate increases more than it already has and that even the period of high rates could be less long than expected.

“Due to the appreciation of the peso, the technical indicators show that the probability of an upward correction for the exchange rate has increased, which if it occurs could take it to 19 pesos per dollar,” explained the local firm Banco Base.

Despite this fall, against an official closing of 19.5089 units per dollar in 2022, the Mexican currency, which last year managed to rank as the second best of the emerging ones, accumulates an advance of 65.96 cents or 3.38 percent.

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