Mexican Peso Strengthens Against Dollar
On Thursday, the Mexican peso gained ground against the dollar for the fifth straight day, closing at 17.65 pesos per dollar, as reported by the Bank of Mexico.
This marks the peso’s strongest performance since July 12, 2024, when it was at 17.62 pesos against the dollar.
The currency appreciated by 0.92% on Thursday, following a previous close of 17.81 pesos to the dollar on Wednesday.
Over the last five business days, the peso has strengthened about 1.9% against the dollar. Looking ahead, the appreciation rate projected until 2026 is slightly above 2%. Interestingly, in 2025, the peso gained around 16% against the dollar, which took many economists and analysts by surprise.
Gabriela Siler, the director of economic analysis at Banco Base, mentioned that factors contributing to the peso’s rise included “1) a weak dollar, 2) carry trade operations due to differing interest rates between Mexico and the U.S., as well as between Mexico and Japan, and 3) an increase in silver prices,” in a post on X.
In another update, she noted that comments from President Sheinbaum regarding maintaining independence for the National Election Authority “fostered optimism for Mexico.”
The federal government is initiating substantial electoral reforms, which are anticipated to be presented to parliament next month.
Interestingly, the peso’s rise occurred despite U.S. President Donald Trump’s recent doubts about the future of the USMCA, stating that the trade agreement doesn’t provide any “substantive benefits” to the U.S. and feels “irrelevant” to him.
Paula Chavez, a financial market analyst at HF Markets, remarked that the market interprets Trump’s skepticism as signifying greater risk for the U.S. than for Mexico.
“The primary reaction has been a reduced exposure to the dollar,” she commented.
Additionally, Chavez noted that the market acknowledges the USMCA’s strategic importance for both Mexico and the U.S. “Undermining it would entail significant costs, particularly regarding competitiveness and production efficiency,” she said.
