On Monday, August 4, 2025, Mexican peso depreciation reversed regional trends, closing at 18.9069 per dollar. This move, compared to Friday’s record rate of 18.8886, marked a 0.10 percent loss for the peso. The dollar ranged from 18.7666 to 18.9534 during the session. The Intercontinental Exchange’s Dollar Index fell 0.40 percent to 98.74. Regional peers gained ground as traders showed a cautious appetite for risk. The exchange rate’s daily moves directly affect import costs and inflation. A weaker peso tends to raise the price of fuel and industrial inputs.
Mexican peso depreciation near flat
Local consumer confidence reached a two-month high on Monday as traders awaited fresh inflation figures. Local markets view consumer confidence as a barometer for spending trends. A stronger outlook may ease inflation fears. Markets expect Banxico to moderate its policy adjustments when it meets on Thursday. “The peso’s performance will be influenced by the local inflation report and Banxico’s decision,” said Monex Grupo Financiero. “Development of global trade tensions in light of U.S. tariffs will also affect sentiment,” the firm added. Those factors helped the peso close virtually flat. Analysts say the shift shows a balanced risk appetite ahead of key events.
Independent consultant Juan Carlos Cruz Tapia set this week’s trading band at 18.75 to 19.00 per dollar. He expects Banxico to cut its benchmark rate by 25 basis points to 11.25 percent. Cruz Tapia said markets will also gauge global trade headlines for clues on export costs. His forecasts carry weight among institutional traders. That outlook may push the currency toward the stated range in coming sessions.
Global outlook and Fed expectations
On Wall Street, the Intercontinental Exchange’s Dollar Index fell after weak U.S. job data. Markets now price a 93 percent chance of a September Fed rate cut. Traders cited Friday’s disappointing non-farm payroll report as a key driver. Those expectations will influence Mexican assets in coming days. CME Group’s FedWatch tool shows a 93 percent probability of a September rate cut. Analysts warn that any surprise in Thursday’s data could trigger more volatility. Investors should monitor key thresholds at 18.85 and 19.05 per dollar. For now, the Mexican peso depreciation remains a cautious reminder of shifting risks in emerging markets.
Technical outlook
Beyond this week, traders will track Mexico’s trade balance due later this month. A shift in exports could swing the peso’s medium-term trend. Corporate earnings season may attract fresh capital flows. Markets will also watch U.S. trading later in the week for fresh signals. A weaker dollar could lift the peso further. Volatility may spike if trade developments diverge from current market expectations. Technical analysts note that the peso’s 50-day moving average sits near 18.95 per dollar. A dip below that level could trigger fresh selling. Conversely, a climb above 18.85 may attract carry trade inflows. Traders will follow technical signals as risk aversion ebbs and flows.
