Peso opens November with a strong loss; profiles fifth consecutive fall

The Mexican peso depreciates against American dollar this Monday. The local currency is shaping its fifth consecutive fall, while traders await the monetary policy announcement of the Federal Reserve from the United States.

The US central bank will release the decision on Wednesday after the two-day meeting. The market awaits news of the beginning of a reduction in its monthly bond buying program, which could be quick.

The exchange rate stands at 20,8006 units against a record of 20,6090 units on Friday, with the close of the Bank of Mexico (Banxico). That means that the peso is back in trading 19.16 cents or 0.93 percent.

According to the records of the Banxico, the peso accumulated until Friday already a loss of 2.13 percent. In its worst moment of the day, the pair touched 20.8272 units, its highest level since Tuesday, October 12 (almost three weeks).

Traders not only await information on the gradual reduction of stimuli, they also operate with caution in the face of possible signs of upcoming interest rate hikes. The bets are on two hikes throughout 2022.

“Markets will trade cautiously ahead of the Federal Reserve’s monetary policy decision on Wednesday. Investors will look for clues as to when it will start raising its benchmark interest rate,” Monex explained.

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Reference-www.eleconomista.com.mx

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