The Mexican peso strengthened toward the $16.75 level, approaching the near-eight-year-high of $16.7 from July 29th, benefiting from a weaker dollar after a batch cooler economic data from the US aligned with bets that the Federal Reserve will refrain from raising interest rates. Domestically, the minutes from the Bank of Mexico’s latest meeting reiterated the central bank’s commitment to maintaining elevated interest rates due to persistently high inflation, which remains significantly above the 3% target. Base effects have recently driven price growth to slow, underscored by the 4.67% mid-month inflation rate in August, but risks of a rebound in inflation and robust labor markets drove Banxico to signal it will keep borrowing costs at the record-high of 11.25% for the foreseeable future.
Historically, the Mexican Peso reached an all time high of 25.78 in April of 2020. Mexican Peso - data, forecasts, historical chart - was last updated on August of 2023.
The Mexican Peso is expected to trade at 17.02 by the end of this quarter, according to Trading Economics global macro models and analysts expectations. Looking forward, we estimate it to trade at 17.89 in 12 months time.