Title: Global Risk Aversion Triggers Mexican Peso’s 15-Day Winning Streak Below 17 Units to Snap
Date: [Insert Date]
An increase in global risk aversion, influenced by Fitch Ratings’ downgrade of the US sovereign debt rating, has led to the depreciation of most emerging currencies. Consequently, the Mexican peso’s 15-day winning streak below 17 units has come to an end.
According to data from the Bank of Mexico (Banxico), the Mexican currency experienced a 1.0 percent depreciation, equivalent to 16.88 cents, compared to its previous day’s closing. The exchange rate is now positioned at 17.02 pesos per dollar.
Throughout the trading session, the exchange rate fluctuated between a maximum of 17.0792 and a minimum of 16.8349 units.
Gabriela Siller, the director of economic analysis at Banco Base, suggests that based on technical indicators, there is the potential for a change in the exchange rate trend, similar to the banking disorder witnessed in the United States in March. Siller states that this could lead to a depreciation of the peso to approximately 17.80 pesos per dollar, with the potential for a subsequent decrease once the current nervousness subsides.
In bank windows, the dollar is currently quoted at 17.40 pesos per greenback, as per data from Citibanamex.
Meanwhile, the dollar index (dxy), which measures the strength of the US currency against a basket of six developed country currencies, has experienced a 0.28 percent increase, reaching 102.58 units. The Bloomberg dollar index (bbdxy) has also risen by 0.45 percent, currently standing at 1,229.68 points.
The US 10-year bond yield is currently at 4.10 percent, compared to Mexico’s 10-year bond yield, which remains steady at 9.20 percent in the money market.
Several currencies have faced depreciation, with the Colombian peso experiencing a decline of 2.49 percent, followed by the Russian ruble at 2.15 percent. The South Korean won, Chilean peso, South African rand, Philippine peso, and Malaysian ringgit have also suffered, with depreciations ranging from 0.52 to 1.12 percent.
As global risk aversion intensifies, investors are closely monitoring currency movements and seeking safe-haven assets to weather the uncertain economic climate.
Please note that the information provided is based on available data at the time of publication and may be subject to change as the situation evolves.