Mexican Peso Slides As Fed Rate Cut Bets Dwindle

(MENAFN- The Rio Times) The Mexican peso weakened against the U.S. dollar on Monday, according to a report from José Antonio Rivera. The local currency fell amid broad dollar strength. This week's key U.S. inflation report looms large over markets.

The peso traded at 20.8032 per dollar, down 0.47% from Friday's official Banxico rate of 20.7052. This represents a loss of 9.8 centavos for the peso. The dollar moved between 20.7005 and 20.8445 pesos during the session.

The Dollar Index, which measures the greenback against six major currencies, rose 0.26% to 109.93. The dollar continued to strengthen alongside U.S. Treasury yields. Investors now expect fewer Fed rate cuts this year amid inflation concerns.

Recent U.S. economic data has reignited worries about economic strength. Strong jobs and services figures surprised markets. Traders now await Wednesday's crucial inflation report for further guidance.

Monex noted the peso is under pressure from the advancing dollar. Markets anticipate U.S. inflation data and seek confirmation of rate cut expectations. Donald Trump's potential return to the White House also weighs on sentiment.



Traders believe Trump's protectionist policies and pro-business measures could further boost the already robust U.S. economy. This may reignite inflation, keeping investors alert to his comments.

The peso recorded four consecutive declines last week. News of Trump's future presidency and U.S. labor market strength negatively impacted the Mexican currency. The peso's outlook remains uncertain as markets digest these developments.

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