Mexican peso depreciation edged 0.06% as markets shunned risk amid Israel’s attacks on Iran. DXY rose 0.29%, gold jumped 1.25%, and oil surged 6.05%
The Mexican peso weakened modestly against the U.S. dollar in mid-session trading on Friday, as investors fled to safe-haven assets following renewed tensions in the Middle East. The spot exchange rate reached 18.9314 pesos per dollar, up from yesterday’s official close of 18.9210, marking a 0.06% depreciation for the local currency.
Earlier in the session, the peso had dipped to an intraday low of 19.1029, briefly losing over 1% before paring losses. Meanwhile, the U.S. Dollar Index (DXY)—which gauges the greenback against six major currencies—climbed 0.29% to 98.15 points, underlining broad dollar strength amid the risk-off mood.
Heightened market jitters were sparked by Israel’s large-scale strikes on Iranian military and energy installations. Israeli forces targeted nuclear sites, ballistic missile factories, and command centers in a bid to thwart Iran’s nuclear ambitions, stoking fears of a broader regional conflict.
“Markets fear that the bombing of Iran’s nuclear and missile sites could trigger a wider military escalation,” said analysts at CIBanco. “The typical market reaction has been a rush into safe-haven assets,” they added.
Reflecting that flight to safety, gold prices climbed 1.25% to $3,429.23 per troy ounce, while West Texas Intermediate (WTI) crude oil surged 6.05% to $71.67 per barrel on supply-concern fears.
Despite the intraday swings, the peso’s overall weekly performance remains muted, as traders balance geopolitical risks with resilient U.S. economic data and mixed signals on Federal Reserve rate policy. Investors will be watching upcoming U.S. consumer price index figures and any central bank commentary for clues on interest-rate trajectories.
In local markets, the Mexican central bank’s latest minutes will also be scrutinized for insights into policymakers’ views on inflation and growth. Analysts expect Banxico to maintain its current stance until clearer signals emerge on global monetary tightening and domestic economic momentum.
Looking ahead, further developments in the Middle East will likely continue to sway sentiment across emerging-market currencies. Should tensions escalate, safe-haven flows into the dollar, gold, and government bonds may intensify, potentially exerting additional pressure on the peso.
Key Indicators at Mid-Session
- Spot Exchange Rate: 18.9314 MXN/USD (−0.06%)
- Intraday Low: 19.1029 MXN/USD (−1% peak loss)
- Dollar Index (DXY): +0.29% to 98.15 points
- Gold (Spot): +1.25% to $3,429.23/oz
- WTI Crude Oil: +6.05% to $71.67/barrel
Investors and market watchers will remain attentive to both geopolitical developments and key economic releases, which together are likely to shape the peso’s trajectory in the coming days.
