Mexican Peso Falls in Today’s Trading and Records Monthly Decline
The currency lost ground following the release of figures on labor costs in the United States, as well as data on local GDP growth for the first quarter.
The Mexican peso depreciated against the US dollar on Tuesday. The currency retreated following the release of US labor cost figures and data on local GDP growth for the first quarter.
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The exchange rate closed the session at 17.1268 pesos per dollar. Compared to the previous day’s figure of 17.0185, according to data from the Bank of Mexico (Banxico), the peso experienced a loss of 10.83 cents or 0.64 percent.
The dollar price fluctuated within an open range, hitting a high of 17.1455 pesos and a low of 16.9594 pesos. The Dollar Index (DXY), from the Intercontinental Exchange, which measures the greenback against six major currencies, rose 0.67% to 106.28 points.
The employment cost index, the best measure of wage pressures, increased by 1.2% quarter-over-quarter in the United States, exceeding the 1% expected and the 0.9% from the previous quarter. These figures confirm a rebound in inflation at the beginning of the year.
Locally, early figures showed that the Mexican economy grew by 0.2% in the first quarter. Data from Inegi indicated that the economy expanded more than expected (0%), but showed a slowdown in its momentum.
Volatility continues, with a trading range of 16.96 to 17.14; the greatest movement occurred after the publication of the Employment Cost Index in the United States.
US rates traded higher, strengthening the hypothesis of a significantly lower number of Fed rate cuts this year. Over the past month, the middle and long end of the curve have risen more than 40 basis points.
Moreover, cumulatively, the peso recorded a monthly decline in April compared to a close of 17.0589 units in March. At its current level, this movement resulted in a cumulative drop of 6.79 cents, equivalent to 0.40 percent.
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