“The dollar’s gain was concentrated during the morning and is due to the expectation that Donald Trump will implement a protectionist trade stance and a strict immigration policy,” explained Banco Base.
“The weakness of the Mexican peso is also due to internal factors. Today the Political Coordination Board of the Chamber of Deputies agreed that on Wednesday the 13th the constitutional reform for the elimination of autonomous organizations will be discussed and voted on. If approved, this reform will cause additional deterioration of Mexico’s institutional framework and would increase the risk of credit rating cuts,” he added.
In addition, “the peso was affected by the weak local industrial production figures and the strengthening of the dollar in the session,” Monex said in an analysis note.
“Volatile days are expected for our currency, as the new government in the United States is formed,” said Intercam Casa de Bolsa, in an analysis note. “While it is true that Trump will take office until January 20, these transition months will be important,” he added.
The next president announced the day before that Tom Homan, a key immigration official from his first term, will be in charge of the country’s borders, an extremely sensitive issue in the relationship with Mexico.
In the morning it was announced that industrial activity rebounded in September, while the consumer confidence index rose in October to its highest level since data was available in 2001.
The figures are the last of relevance that the market will know before the Bank of Mexico’s monetary policy decision, on Thursday, in which it is expected to announce a cut in the key interest rate, following in the footsteps of the Fed last week pass.
Investors will also be waiting this week for the presentation of the Government’s budget package for next year, in which President Claudia Sheinbaum has the challenge of reducing the large fiscal deficit.
If so
The benchmark S&P/BMV IPC stock index lost 0.76% to 51,449.43 points, with a turnover of 156.1 million shares, below the daily average of about 200 million in recent months, due to a partial holiday in the United States for the Veterans Day.
The papers of Grupo Televisa led the decline, with 7.27% less to 8.93 pesos, followed by those of Cemex, which subtracted 3.19% to 11.55 pesos.
In the secondary debt market, the 10-year bond yield rose 11 basis points to 9.99%, the same as the 20-year rate, which ended at 10.24%.
With information from Reuters
