Title: Mexican Peso Slightly Depreciates Against Dollar Amidst Erratic Movements
Date: [Current Date]
The Mexican peso experienced a slight depreciation against the dollar in Tuesday’s operations, following a session of fluctuating movements. The local currency dipped after reaching a minimum level unseen since December 2015, amidst a weak greenback that failed to regain its strength.
According to official data from the Bank of Mexico (Banxico), the exchange rate closed the day at 16.7489 units per dollar, resulting in a loss of one cent (0.06 percent) compared to yesterday’s closing rate of 16.7389 units.
Throughout the day, the peso fluctuated within a narrow range, with the pair trading between a maximum of 16.7833 units and a minimum of 16.6941 units. This minimum level had not been observed since December 2015. Meanwhile, the Dollar Index (DXY), which measures the performance of the greenback against a basket of six other G7 currencies, recorded a modest 0.08% increase, reaching 99.93 points.
The session was marked by the release of retail sales figures in the United States, which showed lower-than-expected growth in June. Consequently, this data supported expectations of reduced inflationary pressures, causing the dollar to initially decline during the session. However, later in the day, factory production figures in the US unexpectedly dropped, leading to a rebound in the greenback due to increased aversion to risk assets, including emerging market currencies like the Mexican peso.
“The Mexican currency is being impacted by rising aversion to risk assets following disappointing data from the United States,” explained analysts from Monex Grupo Financiero in a report distributed to their clients.
Despite this recent movement, analysts suggest that the peso may continue to appreciate. Experts from Intercam Banco point to support around the 16.65 units per dollar level, while resistance is expected between 16.82 and 16.85 pesos.
Overall, these developments highlight the ongoing volatility in the currency markets and underscore the potential for further shifts in the peso-dollar exchange rate.
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