Mexican peso depreciates after US inflation data

The Mexican peso depreciates against American dollar this Thursday morning. The local currency fell, changing its trend at the beginning of the day, after learning that inflation in the United States in September accelerated more than expected.

index US consumer prices registered in September an advance of 0.4%, higher than the expected 0.2% and the previous data of 0.1 percent. High pressure drives bets on seniors rate hikes and the fear that they will cause a recession.

The exchange rate spot is located at the level of 20.0980 units per dollar. Compared with 20.0094 units of yesterday’s official closing of the Bank of Mexico (Banxico), the local currency fell 8.86 cents, which is equivalent to a variation of 0.44 percent.

The cross trades in an open range between a high of 20.0951 units and a low of 19.9503 units. The Dollar Index (DXY), which measures the greenback with a basket of six reference strong currencies, rises 0.35% and stands at the level of 113.72 points.

Although the operating range of the peso remains stable this year thanks to rate increases, despite the fact that the dollar strengthens, the minutes of the Federal Reserve published yesterday confirmed that this authority is planning to further tighten its monetary policy.

“Inflation data for September and the strength of the US labor market point to an aggressive increase in interest rates by the Federal Reserve in the November decision,” said Eduardo Ramos, an analyst at ATFX.

The peso falls in line with other currencies in the region, while the greenback returns to its upward path against its main peers, which in September took it to a 20-year ceiling. In annual terms, inflation fell month to month from 8.3% to 8.2% percent.

jose.rivera@eleconomista.mx