Mexican peso closes the week with advance after Banxico rate hike

The Mexican peso gained on Friday and accumulated a weekly advance driven by the decision of the Bank of Mexico to raise its key rate by 75 basis points, while the stock market rose, but accumulated a new loss in the week due to the nervousness of investors due to a possible global economic recession.

The domestic currency finished at 19.8500 per dollar, with an appreciation of 0.75% against the Reuters reference price on Thursday.

The advance of the peso is largely due to factors related to monetary policy and global expectations, he said. Gabriela SillerBanco Base analyst.

The local currency still has the potential to trade below the support of 19.80 pesos per dollar, as in the last weeks of May, as long as there are no signs of a slowdown in the United States. On the downside, the next important support is located at 19.60 pesos per dollar, he added.

For the week, the peso gained 2.36 percent.

The benchmark stock index S&P/BMV IPC it rose 2.32% to 47,741.50 points.

Still, the stock market accumulated a weekly loss of 0.57%, linking four weeks in decline.

Friday’s advance was led by shares in two of the country’s largest cement companies.

The titles of Grupo Cementos de Chihuahua rose 5.39% to 130.64, followed by Cemex added 4.54% to 7.83%.

In the debt market, the 10-year bond yield rose four basis points to 9.00%, while the 20-year rate rose seven points to 9.01%.

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