Mexican Peso’s Performance
The Mexican peso experienced a minor decline against the U.S. dollar during mid-week trading, with the exchange rate ending at 18.4479 pesos per dollar. This represented a 0.05% decrease, or less than a cent, compared to the previous day’s rate of 18.4397 pesos per dollar, according to official data from Banco de México (Banxico).
The dollar’s price ranged from a high of 18.4706 pesos to a low of 18.3689 pesos, while the Intercontinental Exchange’s Dollar Index (DXY) fell 0.06% to 98.91 units.
Economic Data from the IGAE
The Indicador Global de Actividad Económica (IGAE) reported that Mexico’s economic activity grew at a monthly rate of 0.6% in August, as announced by the INEGI. However, the IGAE also showed that activity decreased by 0.9% in August compared to the same month last year.
Although August’s economic activity figures surpassed analysts’ expectations, the 12-month decline pointed to a weak PIB performance in the third quarter. Preliminary data for this period is expected next week.
Three Weeks of U.S. Government Shutdown
Regarding the ongoing U.S. government shutdown, President Donald Trump rejected a request from leading Democratic lawmakers on Tuesday for a meeting until the shutdown’s end, which has now reached three weeks.
The U.S. government shutdown has led to public employee layoffs and the suspension of official indicators, causing the market to operate “blindly” regarding future monetary policy. Inflation data from the U.S. is expected on Friday.
Slow Technical Behavior
According to analysts, the exchange rate remains confined within its weekly range, exhibiting low volatility and sideways movement in the absence of indicators or catalysts. However, more activity may occur as further information emerges.
“We could see more movement next week due to the expiration of a 90-day extension term for U.S. tariffs’ implementation, announced for Mexico on July 31st, should new deadlines be set or applied,” said Cruz Tapia.
“The peso has a key support level near 18.30 pesos per dollar and resistance around 18.50. As long as it consolidates, there is room for strengthening towards the 18.30 area,” explained Antonio Di Giacomo, XS.com’s markets analyst.
