The Mexican peso it was appreciated against the American dollar this Monday and marked his fourth consecutive breakthrough. The local currency gained ground extending last week’s move, following monetary policy announcements.
The exchange rate ended the day at 20.7478 units against a record of 20.7862 units on Friday, with official data from the Bank of Mexico (Banxico). That was a gain of 3.84 cents or 0.19 percent.
In its winning streak, since a close of 21.2650 units last Tuesday, the peso has accumulated an advance of 51.72 cents or 2.43 percent. The tightening of monetary policies has allowed the peso to appreciate.
The Federal Reserve decided last week to accelerate the pace of stimulus cuts, while the Banxico decided to increase its reference interest rate for the fifth time in a row to a level of 5.50 percent.
On the day, the cross moved in a range between a maximum of 20.9555 units and a minimum of 20.6965 units. The Dollar Index (DXY), which measures the dollar with six currencies, lost -0.05% at 96.51 units at the close.
The rise in the peso was limited by the lower liquidity in the market, prior to the end of the year. In addition, operators were cautious due to concerns about contagious Covid-19 Omicron variant.
“The restrictions cast a shadow over the outlook causing problems in supply chains, which in turn can lead to continued inflation,” said Gabriela Siller, director of Analysis at Banco Base.
Reference-www.eleconomista.com.mx