The Mexican peso appreciated against the American dollar this Friday, after the Bank of Mexico (Banxico) yesterday increased its interest rate by 50 basis points. The improvement allowed it to close the week on positive ground.

The exchange rate ended the session at 20.0877 units, compared to 20.3257 units yesterday, with Banxico data. This movement meant an appreciation of 23.8 cents, which is equivalent to a variation of 1.17 percent.

In the week accumulated, against a record of 20.1294 units per dollar on Friday, the peso gained 4.17 cents or 0.21 percent. This occurred despite the fact that it was the sixth week of strengthening for the dollar.

The Dollar Index (DXY), which measures the greenback with a basket of six benchmark currencies, rose 0.88% to 104.58 units for the week. This Friday it reached a maximum of 105 units, a level of strength not seen since 2002.

Banxico yesterday increased its reference rate by 50 basis points to a level of 7%, which it had when the pandemic began. Last week, the Federal Reserve it also raised the rate 50 basis points to the range between 0.75% and 1 percent.

Inflation in the United States is at a four-decade high and while recent data showed a monthly decline, traders question whether price pressures could yet pick up.

Meanwhile, the increase in local rates maintained the carry trade of the peso, which favored the parity, which the day before reached a weekly maximum of 20.4742 units and this Friday marked a minimum of 20.0784 units per dollar.

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