The peso added four sessions of losses this Friday, pressured by the strength of the dollar, while the BMV rose during a volatile session in line with Wall Street, amid weak figures for the Mexican economy and the outlook for the path of monetary policy by the United States Federal Reserve.
The dollar ended at 18.4847 pesos, a depreciation of 0.52% for the national currency compared to the previous session, according to closing data from Banxico. In the week, the peso lost 0.95%.
“Today, the USD/MXN exchange rate is affected by the advance of the dollar, given greater nervousness in the market, as well as by weak local data, which reinforce the narrative of a slowdown in the economy,” said the Monex brokerage.
Mexico’s Gross Domestic Product contracted in the third quarter in line with what had been preliminarily estimated, due to a weak performance of the industrial sector, which overshadowed a positive review of both agricultural activities and services.
GDP fell 0.3% compared to the April-June period, according to seasonally adjusted figures released on Friday by the INEGI.
Following the figures, Banamex reduced its GDP growth estimate for 2025 to 0.2% compared to the previous 0.4%.
Lee: Banamex cuts forecast for Mexico’s GDP in 2025 to 0.2%
Meanwhile, comments from the head of the New York Fed, John Williams, that the US central bank can still cut interest rates “in the short term” without jeopardizing its inflation target, led traders to increase their bets on a reduction in the cost of credit in December.
However, there are still a number of Fed monetary officials who have expressed doubts about the need for a new reduction, due to high inflation, after the 25 basis point reductions in September and October.
You may be interested: Nvidia loses 3% on Wall Street as optimism about AI deflates
The dollar index rose slightly on Friday, but during the session it reached its best levels since late May.
The minutes of the most recent Banxico meeting published the day before, meanwhile, were considered moderate in tone, which led the market to consolidate expectations of a 25 basis point cut next month.
Analysts now await inflation data for the first half of November on Monday. According to the median of the projections of 10 participants in a Reuters poll, the general consumer price index would have risen to 3.56% year-on-year.
BMV rises 0.38%
The benchmark S&P/BMV IPC stock index, meanwhile, preliminarily advanced 0.38%, to 61,905.1 points, after advancing 1% in the afternoon and trading with slight declines during the session. It accumulated a drop of just under 1% in the week.
Find out: Wall Street loses as fear of an AI bubble prevails again
The titles of the media giant Grupo Televisa led the advance, with an increase of 3.22% to 10.25 pesos, after a sharp drop the day before. Meanwhile, the papers of Grupo Aeroportuario del Pacífico (GAP) added 2.33% to 416.51 pesos, also according to preliminary figures.
In the debt market, the 10-year bond yield rose 7 basis points to 8.82%, while the 20-year rate fell 1 basis point to 9.40%.
With information from Reuters.
Follow the information on the economy and finances in our specialized section
