The Mexican peso declined against the dollar on Tuesday morning. The local currency lost ground after comments from a Federal Reserve official, while investors await a key inflation report in the United States later this week.

The spot exchange rate stood at 16.6900 pesos per dollar. Compared to Monday’s close of 16.6588 pesos, according to official data from the Bank of Mexico (Banxico), this movement represents a depreciation of 3.12 centavos or 0.19 percent for the peso.

The dollar traded within a narrow range, reaching a high of 16.7065 pesos and a low of 16.6337 pesos. The U.S. Dollar Index (DXY), which measures the greenback against six major currencies, fell 0.08% to 104.51 units.

Minneapolis Fed President Neel Kashkari said in an interview today that there would need to be “many months of positive inflation data in the United States before supporting a rate cut,” which is expected in September.

In this context, investors are preparing for the release of the Personal Consumption Expenditures (PCE) price index later this week, the Fed’s preferred inflation measure, seeking clues about the future direction of interest rates. The markets remain concerned about the final stretch in the fight against inflation.

For the rest of the day, the exchange rate is expected to fluctuate between 16.72 and 16.58 pesos per dollar, according to Banco Base. The 20-day moving average price is at the center of this range, at 16.6727 pesos.