Mexican Peso Starts the Week with a Slight Decline; Awaits Local Inflation Data

The Mexican peso weakened slightly against the dollar in Monday’s trading, as the local currency retreated due to a stronger greenback following U.S. economic data and comments from key Federal Reserve (Fed) officials.

The exchange rate ended the day at 19.4104 pesos per dollar. Compared to Friday’s official close of 19.4082 pesos, according to data from the Bank of Mexico (Banxico), the peso depreciated marginally by 0.01%, with the change amounting to less than a cent.

The dollar traded within a range, hitting a high of 19.5031 pesos and a low of 19.3017. The U.S. Dollar Index (DXY), which measures the dollar’s strength against a basket of six major currencies, rose 0.18% to 100.90 points.

After a positive start for the peso, the exchange rate slightly favored the dollar by the close, following the release of a report on U.S. business activity and Fed commentary that tempered expectations around future rate cuts.

Despite a quiet start to the week, markets are anticipating key events, including upcoming inflation data and a Banxico meeting, where another rate cut is expected.

Local investors are awaiting Tuesday’s inflation data for the first half of September, ahead of Banxico’s sixth monetary policy decision on Thursday, following its August rate cut. Globally, investors will also be closely watching U.S. data, especially the Fed’s preferred inflation gauge, the Personal Consumption Expenditures (PCE) index.