Mexican Peso Strengthens as USD/MXN Breaks Below 17
Rabobank analysts Christian Lawrence and Molly Schwartz report that USD/MXN has fallen below 17 for the first time since May 2024, prompting the bank to revise its forecast to 16.5 in the coming weeks. The peso's strength is attributed to carry trade dynamics, which continue to support the currency against the US dollar.
MUFG analysts Derek Halpenny and Abdul-Ahad Lockhart say the Mexican Peso continues to benefit from low FX volatility and strong carry demand, with USD/MXN breaking below 17.00 for the first time since June 2024. They warn that the peso's carry appeal faces crowding risk.
Mexican Peso hits five-month high on weak US jobs data
The Mexican Peso surged to a five-month high against the US Dollar on Friday, driven by a weaker-than-expected US jobs report. The disappointing data fueled speculation that the Federal Reserve may hold off on raising interest rates in 2026, weakening the Greenback and boosting risk appetite. The Peso capitalized on the improved market sentiment to extend its gains.
Banxico holds rate at 6.50%, Rabobank sees support for MXN carry
Rabobank analysts Molly Schwartz and Christian Lawrence note that Mexico's central bank, Banxico, unanimously kept the overnight policy rate at 6.50% on August 6 and continues to judge the stance as appropriate, supporting the Mexican peso carry trade.
Bank of Mexico Holds Rates Steady for Second Straight Meeting, Pushes Back Inflation Target Timeline
The Bank of Mexico decided unanimously at its monetary policy meeting on the 6th to hold the policy rate at 6.50 percent. This marks the second consecutive hold, in line with market expectations. In its statement, the central bank pushed back the expected timing for inflation to converge to the 3 percent target to the fourth quarter of 2027, from its previous forecast of the second quarter of the same year. It noted that risks to the inflation outlook are tilted to the upside, amid persistently high core inflation, trade policy disruptions, and peso depreciation risks. An economist at Capital Economics said the statement was slightly more hawkish than the previous one, and that a rate hike by year-end is possible.
Mexican Peso rallies to one-month high on Hormuz deal speculation
The Mexican Peso surged to a one-month high on Tuesday amid speculation that US-Iran talks could reopen the Strait of Hormuz, easing global inflationary pressures by freeing ship traffic. At the time of writing, the USD/MXN pair traded at 17.26, after reaching a high of 17.33.
Mexican Peso tumbles as Gulf War escalation weighs on mood, Fed eyed
The Mexican Peso lost ground against the US Dollar on Wednesday as risk appetite turned sour amid the escalation of the Gulf War, while traders awaited the Federal Reserve’s monetary policy decision. The USD/MXN traded at 17.51, up 0.47%.
Commerzbank sees slightly stronger Mexican peso outlook
Commerzbank strategist Michael Pfister argues that Banxico’s recent rate cuts were broadly justified by moderating inflation and Mexico’s weakening economy, leaving little reason for the central bank to tighten policy despite markets pricing in roughly three rate hikes.
Mexican Peso to Yen Likely to Stay Firm on Growth Expectations Exceeding IMF Forecasts
Mr. Chen of Sanward Securities indicated that the Mexican peso is likely to remain firm against the yen, as economic growth is expected to surpass the latest IMF forecasts. Mexico's Finance Minister Amador stated that growth will exceed the IMF's downward revision of the 2026 GDP growth outlook to 1.2 percent. He also noted that the June CPI came in at 3.37 percent year-on-year, staying below the policy target ceiling of 4.0 percent for a second consecutive month, and that the Bank of Mexico has no plans to cut rates for the time being, making it easier for peso buying and yen selling to continue from an interest rate perspective. He expects this week's range to be 9.20 to 9.50 yen.
Mexican Peso Gains 0.66% as Risk Appetite Improves
The Mexican Peso gained ground versus the Greenback on Monday, up by 0.66% as risk appetite improved despite escalating tensions in the Middle East. At the time of writing, the USD/MXN trades at 17.43 after hitting a daily high of 17.55.
Mexican Peso surges as US inflation data weighs on the Dollar
The Mexican Peso appreciated against the US Dollar during the North American session, rising 0.29% after the latest US inflation reports eased expectations that the Federal Reserve would raise rates to tackle high inflation. At the time of writing, the USD/MXN trades at 17.38.
Mexican Peso-Yen Expected to Trade in 9.05–9.35 Yen Range This Week
Sanward Securities' Mr. Chen expects the Mexican peso-yen to trade in a rangebound manner due to a lack of catalysts, forecasting a range of 9.05 to 9.35 yen this week. While the June US employment data came in below expectations and pushed back the outlook for Federal Reserve rate cuts, the Bank of Mexico is seen as having ended its rate-cutting cycle, keeping its policy rate unchanged at 6.50%. The consumer price index for the first half of May rose 4.11% year-on-year, showing a slowdown, and many in the market see no change in rates this year. Additionally, the Trump administration did not agree to extend the United States–Mexico–Canada Agreement, which will remain in force for the next ten years, though this is subject to change if the three countries agree on amendments. Finance Minister Amador noted that the International Monetary Fund's downward revision of the 2026 GDP growth forecast to 1.2% was due to a broader downgrade of global economic prospects rather than domestic factors, and argued that the 2025 outcome was close to the government's forecast.
Mexican Peso gains as risk appetite improves, weighs on USD
The Mexican Peso registered solid gains of over 0.22% against the US Dollar on Thursday as risk appetite improved after two days of hostilities between the US and Iran ended, despite US President Donald Trump's warning that the deal might be “over.” The USD/MXN pair traded at 17.54.
High real yields underpin Mexican Peso demand despite Moody’s downgrade, says Rabobank
Rabobank strategists Christian Lawrence and Molly Schwartz note that high real yields continue to underpin demand for the Mexican Peso, even after Moody’s downgraded Mexico’s rating to Baa3. They observe that 10-year MBono yields have fallen and that markets remain relaxed about Mexico’s investment-grade status.
Mexican Peso rises on soft US jobs data, intervention speculation
The Mexican Peso advanced against the US Dollar, with USD/MXN trading at 17.48, down 0.43%. The move was driven by a weaker-than-expected US jobs report that weighed on the greenback, alongside speculation of intervention in foreign exchange markets by Japanese authorities.
Policy uncertainty caps nearshoring upside for Mexican Peso, says Societe Generale
Societe Generale's Dev Ashish noted that Mexican Peso price action was relatively muted after the United States-Mexico-Canada Agreement extension decision, indicating investors largely expected the outcome.
The Mexican Peso lost ground against the US Dollar on Wednesday amid growing speculation about a cancellation of the USMCA free trade agreement signed in 2020, alongside overall US Dollar strength. At the time of writing, the USD/MXN traded at 17.55, up 0.37%.
Societe Generale says Mexican Peso under pressure as Banxico pauses
Societe Generale strategists note that USD/MXN has held key lows near 17.10 and is now trying to break out from a small base formation. Initial resistance is at the 200-day moving average around 17.80, with a recent low at 17.30 acting as support.