He Mexican peso regained ground against American dollar this Tuesday. The local currency appreciated slightly after learning that general inflation in Mexico continued its downward trend in April, which could lead to a pause in local rate hikes.
He exchange rate concluded this session at the level of 17.7586 units per dollar, compared to a close of 17.8028 units yesterday, with official data from the Bank of Mexico (Banxico). The move meant an appreciation of 4.42 cents or 0.25 percent.
The crossing operated in an open range with a maximum of 17.8315 units and a minimum level of 17.7432 units, close to the minimum of five and a half years that it marked yesterday. He Dollar Index (DXY), which measures the dollar against six currencies, gained 0.27% to 101.65 points.
Mexico inflation slows
Mexico’s headline inflation slowed in April for the third consecutive month to 6.25% annual, (its lowest level since October 2021), while the core index fell to 7.67%, reported early the National Institute of Statistic and Geography (Inegi).
The inflation data confirmed that the pressure on prices continues to ease and this supports hopes that Banxico could put a pause in the cycle of interest rate increases in its decision next week, on May 18.
“After the inflation data, our expectation of a pause by Banco de México is reinforced, which encourages the search for assurance of high interest rates,” analysts said in the morning. Actinver Financial Group in a report.
Inflation and US debt
Market participants will learn key US inflation data tomorrow. A decrease in pressure could also mark a pause in the rate hike cycle of the Federal Reservewhich added 25 basis points on Wednesday.
The market also continues to watch US President Joe Biden meet with House Speaker Kevin McCarthy and senior congressional officials for debt ceiling talks.
