The exchange rate stood at 20.0342 pesos per dollar at the close of the session, the best level for the national currency since November 7, according to Banxico data.
With today’s closing data, the peso appreciated 1.30% compared to the previous day, the largest gain since November 19. In the weekly accumulated, the peso appreciated 0.47%.
The advance of the peso was in line with other Latin American currencies, amid a decline in the dollar in international markets, according to Reuters.
“The appreciation of the peso is due to a downward correction of the dollar,” the Base financial group stated in a report at the beginning of the session.
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“Because of the above, the probability remains high that the exchange rate will continue with a downward correction in the short term and consolidate around 20.00 pesos per dollar,” he stated.
In a report after the market closed, Base stated that the dollar cut its gains after in the United States, the personal consumption price index showed a monthly increase in November slightly below market expectations, which moderated the nervousness about a possible rise in inflation.
The DXY dollar index, which measures the greenback against a basket of currencies, weakened and closed with a depreciation of 0.63%, according to an afternoon report from the Monex financial group.
He added that the peso benefited from recent inflation expectations towards 2025 from both Banxico and the Federal Reserve, in addition to a modest economic agenda for the remainder of the year.
“Overnight, we would expect the peso to oscillate in a range between $19.98 and $20.14, considering the current trend and waiting for biweekly inflation figures in Mexico on Monday,” he said.
In another document published during the session, Base indicated that with the appreciation of the peso, the exchange rate once again pierced the 50-day moving average, which is located at 20.17 pesos per dollar.
Base clarified that the movement of the exchange rate below the 50-day moving average only signals a greater probability of appreciation, but does not guarantee a change in trend.
“It remains likely that the Mexican peso will find it difficult to appreciate below 20.00 pesos per dollar, due to the risk outlook for Mexico in 2025,” he added.
He recalled that in the last two weeks of the year a decrease in liquidity is expected in the exchange market, due to the Christmas and New Year festivities.
He added that these days the publication of relevant economic indicators is also decreasing, so exchange rate variations will depend mainly on adjustments in speculative positions and news related to political factors, particularly in the United States, where the risk of a partial suspension of government operations, and there is caution in anticipation of Donald Trump’s inauguration in a month.
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