The superweight continues to 'fly high'!  Touching its best level since February 2020 – El Financiero

The superweight continues to ‘fly high’! Touching its best level since February 2020 – El Financiero

Weight It rose against the dollar on Tuesday, supported by foreign currency flowing into the country via the . foreign direct investmentremittances and exports are placed at their best level since February 2020.

According to data from the Central Bank of MexicoThe national currency appreciated by 0.33 percent or 6.38 cents, bringing the exchange rate to 19.23 pesos per dollar.

During the session, the peso reached a maximum of 19.32 and a minimum of 19.04 units per dollar.

«The price of the Mexican peso against the dollar fell below 19.25 units and fell to 19.03, reaching the lowest level since February 2020. However, the dollar began to recover at the beginning of the session in the US», emphasize OctaFX experts.

in the bank windowThe dollar was sold at 19.71 pesos per unit, according to data from Citibanamex.

The peso, which gained 6.20 percent against the dollar throughout the year, positioned itself as one of the strongest currencies throughout the year. This is its best performance in a similar period since 2017.

The strength of the Mexican currency is supported by the interest rate differential between Mexico and the United States, foreign currency inflows in foreign direct investment, remittances and exports, as well as the country’s solid macroeconomic fundamentals that led to it. The peso is one of the few currencies that has appreciated against the dollar so far this year.

“19.00/05 area is an important support. A breakout will open the door to more earnings for the peso. As long as it stays above, a consolidation between 19.00/05 and 19.25/30 looks likely. This positive outlook for the Mexican currency came amid rising emerging market currencies against the US dollar.

dollar index (dxy), The index, which measures the strength of the US currency against a basket of developed country currencies, increased by 0.15 percent to 106.84 points.

For the Bloomberg Dollar Index (bbdxy), The 0.11 percent decrease was reflected in 1,279.54 integers.

In the money market, the Mexican 10-year Mbono’s yield is at the level of 9.57 percent, while the yield of the US 10-year bond is at the level of 3.75 percent.

Among the currencies that have appreciated the most against the dollar are:

  • Brazilian real with 1.5 percent
  • Chilean peso, with 1.06%
  • South Korea won with 1.03%.
  • South African rand with 0.89 percent

Main supports

Jacobo Rodríguez, director of economic analysis at Black Wallstreet Capital, stressed that the peso’s positive performance has continued throughout the year, and a few days from now are not the issue.

“Empowering is about the difference. interest rates with the USAand Entries to Mexicoremittances and foreign direct investment side”, he underlined.

However, there has been some backing the Mexican peso lately, and that’s what the country’s authorities are saying. Federal Reserve choose to moderate interest rate goes up.

Gabriela Siller, director of economic analysis at Banco Base, acknowledged that the strength of the local currency is driven by the influx of foreign currency into the country. export, remittance, foreign direct investment and recently by foreign portfolio investmentAs bets continue in favor of the peso in the Chicago futures market, at the same time Bank of Mexico Follow the Fed.

In a recent report, risk rating agency Fitch Ratingin the context of greater global financial and economic uncertainty, Mexico’s external risks found by Exchange rate, narrow current account deficit funded by foreign direct investment flowsat sufficient levels international reserves and prudent monetary policy.

“These days, the dollar is weighing on the expectation that the Fed may be less aggressive and even reverse monetary policy at some point. rate increase cycleAdded to this is that rates will continue to be very high in Mexico and continue to be a very attractive spread. investors”, noted Carlos Hermosillo, an independent analyst.

Analyst Eduardo Ramos financial marketsFor ATFX LATAM, Mexican peso He was able to strengthen himself before. US employment data this week and a strong selling Thanksgiving weekend Black Friday indicates a slow decline in levels. inflation for the beginning of the year.

power will follow

Analysts predict that weight it stays strong for a few weeks and even eventually gains value close to or below 19 units. local risk factors Issues must also be factored in, so although the peso has come as a surprise, it is possible that we could see an upside recovery operating around 19.50 or 19.80 units in the short term.

Banco Base analysts Exchange rate It could consolidate in a new channel between 19.18 and 19.30 pesos per dollar and open the door to further appreciation.

Janneth Quiroz, vice president of analysis at Monex, pointed out that although the peso closed below the support level of 19.25, the breakout is weak, so we have to wait to determine whether it will continue its positive trend after the consolidation period.

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