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© Reuters.
By Carjuan Cruz
Investing.com – The Mexican peso had a negative month, the currency depreciated 4.3% in November, after jumping from 20.55 per dollar to 21.4 per dollar. Although today it shows signs of recovery with the exchange rate falling 1.12%.
The depreciation of the currency began last week in principle due to the strength of the dollar, however, it was further precipitated by the uncertainty generated in the market by the delay in the nomination of the president of the Bank of Mexico.
The sudden change from Arturo Herrera to Victoria Rodríguez raised more pressure on the pair. “The market has yet to assimilate the change, and as the new nominee sends messages in favor of the autonomy of the central bank, it is possible that the exchange rate will give way,” explained Jorge Gordillo, director of economic and stock market analysis at CIBanco.
Read more: Mexican peso: 3 keys necessary to return to 20 per dollar
In addition to the local situation, the discovery of the new variable Ómicron at the end of last week triggered global panic, causing sharp falls in the different global indices and consolidating the depreciation brought by the peso.
This week, the tension around the new strain eased, but it will all depend on announcements from the big vaccine manufacturers as to its effectiveness for the newly detected variant.
“Today’s volatility shows that trader sentiment is going to remain extremely fickle until you have a clearer idea of what’s to come in relation to the new variant,” Gordillo added.
It will be within a few weeks when the true risk represented by the new variant is known.
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