The Mexican peso depreciates against dollar this Tuesday. The Mexican currency loses ground for the fourth consecutive day, pressured by an increase in interest rate hikes in the United States in 2022.
The American President, Joe Biden, yesterday nominated Jerome Powell to continue in front of the Federal Reserve (Fed) for a second period, raising the stakes on interest rate hikes in the United States.
The exchange rate stands at 21.1404 units per dollar compared to yesterday’s official closing of 20.9821 units, with the data from Bank of Mexico (Banxico). That means a loss of 15.83 cents, equivalent to 0.76 percent.
At its worst of the day, the crossing peaked at 21,1929 units (its highest record since March 10). The minimum of the day was located at 20,9,940 pesos, just below the 21-unit range.
The Dollar Index (DXY), which compares the green bill with a basket made up of six reference currencies, falls a marginal -0.06% to 96.49 points, but remains close to a maximum of 16 months, after the nomination.
“From a technical point of view, once the level of 21 pesos per dollar has been pierced, the probability of episodes of volatility increases and the exchange rate could reach levels between 21.20 and 21.40 units,” explained Banco Base.
In its negative streak, the peso has lost more than 1.5% and near the end of the year, it outlines an annual decline of more than 6 percent. Its behavior could be defined for the rest of the week by important economic data.
During the week the minutes of the latest Fed and Banxico monetary policy meetings will also be released. Operators are also waiting for information on Covid-19 and its recent rebound in Europe.
Reference-www.eleconomista.com.mx