The Mexican peso registered slight losses against the US dollar after the opening of markets on Wednesday, January 29. Specialists speculate that the Bank of Mexico may make continuous cuts to its interest rate in the coming months, while the US Federal Reserve maintains its economic policy for longer.
The US dollar is trading at the beginning of the day at 20.58 Mexican pesos on average, which meant a change of 0.13% compared to 20.55 pesos the previous day.
In the last seven days, the US dollar has registered an increase of 0.92%, so that for a year now it still maintains an increase of 20.61%.
Compared to previous days, it reverses the price of the previous session, where it registered a decrease of 1.88%, recently showing a lack of continuity in the result. The volatility figure is 13.78%, which is a slightly higher figure than the annual volatility figure (12.7%), so it is going through a phase of instability.
Economic forecasts for 2025
The peso-dollar relationship during 2024 was marked by contrasts. The year began with the Mexican currency strengthening against the US currency. The greenback was sold at 16 pesos per unit, something that had not happened in almost a decade. The nickname “superpeso” was more appropriate than ever.
However, as the peso advanced, it depreciated mainly due to political decisions, such as the controversial Reform of the Judicial Branch and the elimination of autonomous bodies.
The decline of the Aztec currency was aggravated by Donald Trump’s campaign, his electoral victory as president of the United States and his threats to impose tariffs on all Mexican – and Canadian – products if Mexico did not improve security at the border.
This is how the dollar returned to 20 pesos, well above the forecasts of the Bank of Mexico (Banxico).
For 2025, Banxico expects the dollar to trade at an average of 20.24 pesos to 20.69 pesos, a conservative forecast considering the repercussions that Trump’s statements and policies in the White House would have on the exchange rate.
Inflation was relatively stable in 2024, hovering around 4%, except for June when it almost reached 6%, according to data from the National Institute of Statistics and Geography (Inegi).
This year, Banxico forecasts that inflation will be below four points, up to 3.8%.
As for the growth of the Gross Domestic Product (GDP), the low forecasts remain. The central bank expects a GDP increase of just 1.2%.
What is the Mexican Peso?
The Mexican peso is the legal currency of Mexico and is the first currency in the world to use the $ sign, which was later adopted by the United States for the dollar.
This currency is the fifteenth most traded currency in the world, as well as the most traded in Latin America and the third on a continent only behind the US and Canadian dollars.
Currently, the abbreviation MXN is used to refer to the Mexican peso, but before 1993, the initials MXP were used.
The coins normally used in Mexico are semicircular in shape and have the national emblem on the back. One Mexican peso is equivalent to 100 cents. There are coins of 1, 5, 10 and 20 pesos; while there are bills of 20, 50, 100, 200, 500 and 1,000 pesos.
Source: infobae
