The Mexican peso weakens against the dollar in Thursday trading as the US currency firms. The session ends with the exchange rate at 18.6402 per dollar. Yesterday’s Banxico reference was 18.5803, so the peso gave up 5.99 cents, a 0.32% slip.
It was a volatile day. Prices ranged from 18.6291 on the low to 18.8532 on the high, brushing a one-week peak before easing back into the close.
The dollar’s broader tone did the heavy lifting. The Intercontinental Exchange’s Dollar Index rose 0.40% to 98.19, reflecting strength against major peers.
A fast swing on a stronger greenback
The move followed US figures that came in hotter than expected. Producer prices rose more than forecast in July. Treasury yields climbed after the release, and the dollar gained.
“Inflation data continues to affect the market,” said independent FX trader Enrique Bazaldúa. “The market is extremely volatile today; the Mexican peso rose sharply above 18.85,” he added, as prices spiked during the morning rush and then retraced.
A second data point was added to the tone. New US jobless claims fell last week. That read reinforced a picture of resilient employment and pared back the need for heavier rate cuts.
What the September odds now imply
Futures pricing nudged but did not flip the base case for September. According to the CME’s FedWatch gauge, bets show a 92.6% chance of a 25-basis-point move and 7.4% for no change. Earlier, the split leaned 93.8% for 25 bps and 6.2% for 50 bps. The market is still pointing to a start with 25, but with thinner conviction on a larger first cut.
What Fed voices are signaling
Officials stayed out of the 50-point camp for now. St. Louis Fed President Alberto Musalem said a 50-basis-point cut in September would not be justified given current conditions.
On the policy path more broadly, Treasury Secretary Scott Bessent—who a day earlier floated the possibility of as much as 50 bps this year—said conditions look favorable for a cut, suggesting the central bank could start with 25 bps and then accelerate, in remarks to Fox Business Network.
Together, the signals point to a cautious start and a data-dependent glide path after that.
Why it matters at home
For households and firms in Mexico, these swings ripple through budgets. Importers and travelers feel it first when the dollar rallies. Exporters and remittance receivers see the other side of the move. Today’s action shows how sensitive the peso remains to US inflation prints and labor signals. Until the rate path is clearer, quick intraday moves—like this morning’s jump above 18.85—will remain part of the landscape.
The day ends with the peso softer and the dollar a touch stronger. The story is still the same: US inflation and policy expectations are calling the tune, and the peso is dancing to it—step for step.
