The peso closed the session with an appreciation of 0.52% or 10.5 cents, trading around 20.10 pesos per dollar, with the exchange rate touching a maximum of 20.2305 and a minimum of 20.0651 pesos, a level not seen since February 16.
With today’s movement, the Mexican peso accumulated an appreciation of 1.61% or 32.8 cents during April.
It should be noted that the Mexican peso was the eighth most appreciated currency during the session, the most appreciated currencies being the Polish zloty with 1.07%, the Swedish krona with 1.00%, the Brazilian real with 0.75% and the Chilean peso with 0.68 percent.
The appreciation of the peso was due to the following factors:
- The weighted index of the dollar showed a decline of 0.34%, being the largest daily fall since March 17. Likewise, the weakness of the dollar was the result of a greater appetite for risk in global financial markets. The dollar increased its losses after 11 a.m., after Fed Chairman Jerome Powell said that although they will maintain a broadly accommodative monetary stance, they are monitoring inflation expectations and will react in the event that these expectations move above levels with which they “feel comfortable.”
Powell’s comments also put downward pressure on Treasury rates, with the 10-year bond falling 4.4 basis points to 1.63 percent.
- In Mexico, inflation in March was at an interannual rate of 4.67%, the highest since December 2018, the result of a monthly inflation of 1.69% in the non-core component, driven by energy prices. If inflationary pressures continue, in addition to the mathematical effect due to the low comparison base during the second quarter, the door opens for inflation to close the year above 5%. Due to inflationary pressures, Banco de México is expected to keep its reference rate unchanged for the rest of the year.
In Friday’s session, the markets could react to the publication of producer prices in the United States, since producer inflation in March could be close to 3.8%, above the 2.8% registered in February and its highest level since September of 2011.
In the session, the euro touched a minimum of 1.1861 and a maximum of 1.1927 dollars per euro. Finally, the euro peso touched a minimum of 23.8821 and a maximum of 24.0134 pesos per euro.
At the close, the interbank prices for sale stood at 20,1020 pesos per dollar, 1.3733 dollars per pound and 1.1915 dollars per euro.
Gabriela Siller; PhD
Director of Economic-Financial Analysis.