The Mexican peso began this Friday with a slight depreciation due to the assimilation of the decision of the Federal Reserve (Fed) and the quarterly GDP data in the US, which gave rise to growing bets that the Fed could reduce the rate of rises in rates for your upcoming meetings. If it stays at the current level, the local currency would achieve its best performance since the week of June 24.
According to data from Bloomberg and Bank of Mexico (Banxico), the Mexican currency began this Friday with a depreciation of 0.06%, remaining at 20.3064 units, if this trend continues, a five-day appreciation rally would be broken. The operating range is between 20.2071 and 20.3332 units.
In the weekly balance, the peso strengthens 1.29% compared to the previous Friday, which means that it points to its greatest appreciation in five weeks.
“The truth is that the GDP data have made the probability of continuing with a restrictive and aggressive cycle by the Federal Reserve, have substantially decreased, which suggests that, with a monetary policy in Mexico such as the one planned , the ‘carry trade’ will continue to be the ‘driver’ of our currency. We will have more certainty at Banxico’s mid-August meeting,” said Roberto Galván, director of the exchange desk at Intercam.
The dollar index remains stable
The dollar index (DXY) does not register important changes during the day this Friday, since it registers a marginal increase of 0.03%, standing at 106.30 points compared to Thursday. On the other hand, in the weekly balance, the US currency points to its second consecutive fall with 0.3%.
The euro continues with uncertainty
In the morning, the single currency of the European Union registered a fall of 0.18%, trading at 1.0178 euros per dollar.
Appetite for risky assets was limited by the fact that the euro was struggling to stay above the $1.02 levels on fears that the euro zone economy could slip into recession at the end of the year. In addition to the uncertainty generated by the tug-of-war by the energy sector with the Nord Stream 1 gas pipeline.
GDP figures in the euro zone on Friday beat expectations, although recession fears are rising as energy inflation continues to weigh in the face of war in Ukraine.
With information from Reuters
