Peso appreciates for the third consecutive day against the decline of the dollar

He Mexican peso was valued against the American dollar this Tuesday, for the third consecutive day. The local currency benefited from an improvement in the appetite for risk assets that generated a global drop in the greenback due to lower fears about banks.

He exchange rate ended this day at the level of 18.2268 units per dollar compared to a close of 18.3527 units yesterday, with official data from the Bank of Mexico (Banxico). This movement meant an advance of 12.59 cents or 0.69 percent for the peso.

The crossing operated in an open range between a maximum of 18.3587 units and a minimum level of 18.2178 units. He Dollar Index (DXY), which compares the greenback with a basket of six reference currencies, fell 0.43% at the close to a level of 102.41 units.

Optimism for banks and consumption

The mood improved in financial markets after First Citizens BancShares bought the assets of the collapsed Silicon Valley Bank (SVB). Attention now turned to the start of a series of hearings before the Senate on the bankruptcies of SVB and Signature Bank.

“Investors are hopeful that the worst of the banking crisis is over,” CI Banco firm said in an analysis note. “To the extent that the situation regarding global commercial banks improves, there is room to return to see levels below 18 pesos.”

Added to the optimism was consumer confidence data in the United States published early in the morning by the Conference Board. Its index gave a reading of 104.2 points in March, a figure that was higher than expected and the February figure of 102.9 points.

In the local aspect, the operators are preparing for the announcement of Banxico’s monetary policy, this Thursday. Expectations are directed toward a 25 basis point increase in the key rate, which would place the price of money in Mexico at the 11.25 percent level.

In three consecutive days with gains, compared to an official closing of 18.6139 units per dollar last Thursday, the Mexican currency accumulates an appreciation of 38.7 cents or 2.08% in its streak of advances.

jose.rivera@eleconomista.mx