Mexican peso depreciation accelerated Wednesday, with the currency down 0.60% to 19.3840 per dollar ahead of Fed meeting minutes and Bank of Mexico’s quarterly report.
The Mexican peso slid 0.60 percent against the U.S. dollar on Wednesday morning as traders positioned ahead of the release of minutes from the Federal Reserve’s latest policy meeting. By mid-morning local time, the spot rate stood at 19.3840 pesos per dollar, compared with yesterday’s official close of 19.2683 pesos, marking an 11.57-cent drop in the peso’s value.
Trading ranges for the dollar widened early in the session, reaching an intraday high of 19.4000 and dipping to a low of 19.1112. Meanwhile, the Intercontinental Exchange’s Dollar Index (DXY), which tracks the U.S. currency against a basket of six major peers, climbed 0.20 percent to 99.80 as investors sought safe-haven positions ahead of the Fed minutes release.
Monex Grupo Financiero attributed the peso’s pullback to renewed strength in the dollar following news that the U.S. postponed planned tariffs on several Eurozone imports. “The Mexican peso is losing upward momentum and retreating against the U.S. dollar, as investors remain optimistic about the U.S. currency after the announcement of the postponement of tariffs for the Eurozone,” Monex said, noting that risk sentiment had shifted slightly in favor of the greenback.
Attention now turns to the Fed’s meeting minutes, expected later Wednesday. Markets will scrutinize details on policymakers’ discussions around inflation, economic growth, and the timing of future rate adjustments. At its May meeting, the Fed left rates unchanged but signaled that further tightening could be warranted if price pressures remained elevated. Clues in the minutes—and in the language around forthcoming decisions—could prompt another round of volatility in emerging-market currencies, including the peso.
On the domestic front, Mexico’s central bank will publish its quarterly report today, offering fresh projections on inflation, GDP growth, and the outlook for Mexico’s benchmark interest rate. Economists broadly expect Banxico to maintain its policy rate at 11.25 percent, but any shift in tone—either toward additional tightening or hints at a more patient stance—could sway peso traders.
“Investors will look for Banxico’s view on whether recent inflation readings merit further rate hikes or if the bank is comfortable pausing to assess the lagged effects of earlier tightening,” said a strategist at a major brokerage in Mexico City. Recent data showed headline consumer prices inching lower but core inflation stubbornly above target, leaving policymakers in a delicate balancing act.
Regional currency moves mirrored the peso’s modest weakness. The Brazilian real and South African rand both eased on Wednesday, reflecting a broader trend of dollar strength ahead of key Fed and European Central Bank communications. Commodity prices held relatively steady, with oil trading near $73 per barrel and gold hovering around $1,920 an ounce, leaving commodity-linked currencies largely unmoved.
Looking ahead, traders will also monitor this week’s U.S. economic calendar, including consumer confidence data on Thursday and the final GDP revision on Friday. In Mexico, the release of retail sales figures and industrial production numbers later in the week could offer additional insight into the economy’s resilience and shape expectations for Banxico’s next moves.
As the peso navigates these cross-currents, market participants will balance global monetary policy signals against Mexico’s own inflationary dynamics. For now, the currency’s retreat ahead of the Fed minutes and the Banxico report underscores the sensitivity of emerging-market assets to shifts in developed-market policy.
Mexican peso depreciation accelerated Wednesday, with the currency down 0.60% to 19.3840 per dollar ahead of Fed meeting minutes and . . .
