dollar to peso exchange rate
The domestic currency was trading at 17.4922 per dollar, with a loss of 0.33% against the Reuters reference price on Monday, when it reached a record of 17.4140 units.
“Although the depreciation is moderate, it is the consequence of greater risk aversion, due to the fact that no progress has been made in the United States in the negotiations to raise the debt ceiling, and there are more and more indicators that point to a slowdown economy,” said the firm Banco Base.
At the local level, the eyes of investors were on the monetary policy decision of Banco de México that will be disclosed on Thursday, with the expectation that it will announce the end of the monetary tightening cycle that began in June 2021.
For the rest of the day, the currency was expected to oscillate in a range of 17.40 to 17.58 per dollar, Banco Base added in an analysis note.
Why is the Mexican peso strong?
According to Banco Base, the downward trend for the exchange rate has been due to 3 factors:
1. The dollar flows who have come from abroad exports, remittances and foreign direct investment.
2. Tight monetary policy Banco de México maintains a wide interest rate differential with respect to the United States (600 basis points).
3. The international preference for investing in currencies that have a good perspective, such as the Mexican peso, since it is the most liquid currency in all of Latin America.