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Dollar in Mexico: The peso loses strength after markets open on November 8

Dollar in Mexico: The peso loses strength after markets open on November 8

The extra weight disappeared at the beginning of Wednesday (Reuters/Jose Luis Gonzalez)

he Weight The day began on Wednesday, November 8th Trading down Before dollarTo end the positive series recorded at the beginning of this month.

he American dollar It is negotiated at the beginning of the sessions 17.50 Mexican pesos on averageWhich means an increase of 0.15% compared to the previous day’s data, when it amounted to 17.47 Mexican pesos on average.

Taking into account the last seven days, and American dollar Notice a decrease in 0.24% And last year continues to accumulate a decline in 8.66%.

As for the past days, it reflects the result of the previous day, as it ended with a decrease of 0.37%, which indicates its inability to establish a stable trend in recent days.

Last week the volatility was somewhat lower than that accumulated last year, so we can say that it is going through a period of greater stability recently.

The decline of the peso against the dollar occurs ahead of the speech of the Director of the Federal Reserve (FED) of the United States, Jerome Powell. The Federal Reserve was cautious in its statements regarding the fight against inflation, stressing that the battle is still ongoing, as well as the decision to maintain high interest rates.

Throughout the year, the peso strengthened against the US currency. (Giovanni Perez/Infobay)

The Mexican economy has recorded a series of contrasts in recent years. With zero growth – even before the pandemic – it has recently begun to recover.

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Inflation began to grow from the beginning of 2021, reaching an all-time high of 8.7% in September last year. Since then it has been declining. The above is largely due to the monetary policy of the Bank of Mexico (Banxico), which chose to increase the reference rate to 11.25%.

Although Banxico itself emphasizes that headline inflation is already at low levels according to its historical behavior, this “does not mean that the deflation process should be taken for granted, because the levels are still above the target.”

The Central Bank’s Governing Council estimates that “inflationary expectations will be complex and uncertain” and “with upside risks”, and therefore – to maintain the 3% target – “it will be necessary to keep the reference rate at its level.” “Current for an extended period.”

For its part, the peso saw a better scenario. Since mid-2022, the Mexican currency has been strong against the dollar to the point that the national currency has earned the nickname “superweight.”

The dollar reached its lowest point in July 2023, when it was priced at just over 16 pesos per unit, a number not seen since 2015. Although the peso has had its ups and downs, the trend remains upward against the dollar. .

Mexican 500 peso banknotes bearing the image of Benito Juarez, former President of Mexico, arranged for a photo op in Mexico. Photographer: Cesar Rodriguez/Bloomberg

The Mexican peso is the legal tender of Mexico and is the first currency in the world used by Mexico $ signwhich was later taken up by the United States against the dollar.

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The Mexican peso is The fifteenth most traded currency in the worldIn addition, it is the most traded dollar in Latin America and the third largest on the continent after the US and Canadian dollars.

Currently the abbreviation is used Mexican peso To talk about the Mexican peso, but before 1993 the abbreviation MXP was used.

Coins commonly used in Mexico are semicircular in shape and have the national coat of arms on the reverse side. One Mexican peso is equivalent to 100 cents. There are coins of 1, 5, 10 and 20 pesos; While banknotes contain 20, 50, 100, 200, 500 and 1000 pesos.