Nilsa Hernandez
Mexico City / 17.11.2024 12:55:57
The US dollar may fluctuate this week between 19.80 and 20.80 pesos, CiBanco analysts considered.
In their weekly report they indicated that there are three variables that will affect the behavior of the Mexican currency this week; The first is the inflation report in the United States, whose expectation is a slight increase in the annual rate and the policy ideas of Donald Trump, virtual president-elect of the United States, which would be inflationary, are becoming more relevant.
Also, the monetary policy decision of the Bank of Mexico will influence, where a cut in the interest rate of 15 basis points is anticipated.
In addition, the 2025 Economic Package will influence the exchange rate parity with attention paid to possible spending cuts that will allow the public deficit metrics to be reduced.
CIBanco also highlighted that the Mexican peso faces a “hangover” given the arrival of Trump to the presidency of the United States and the Fed’s decision to cut the interest rate.
Among the expectations for the following week, the main economic references and events will be: The attention of world markets to the United States inflation data for October.
Additionally, the United States will publish producer prices, retail sales and industrial production for October. The New York manufacturing index and the change in oil inventories and initial jobless claims for November.
In Europe, there will be the Gross Domestic Product (GDP) data for the third quarter of the year and industrial production for September.
LP
follow us on
Welcome to our World Today News interview. Today, we have two distinguished guests to discuss the potential fluctuations of the US dollar against the Mexican peso this week. Our first guest is Nilsa Hernandez, an international economist from Mexico City, and our second guest is Philip Roberts, a finance expert from New York City.
Nilsa, let’s start with you. As per the article, you mentioned that three variables will influence the behavior of the Mexican currency this week. Could you please elaborate on them and how they might impact the US dollar-peso exchange rate?
Nilsa Hernandez: Of course. The first variable is the inflation report in the United States, which is expected to show a slight increase in the annual rate. This could weaken the dollar against major currencies like the peso. The second factor is the policy ideas of Donald Trump, which are becoming more relevant as he prepares to take office. His administration’s policies could be inflationary, which could cause the dollar to depreciate further. the monetary policy decision of the Bank of Mexico also plays a role. A cut in interest rates of 15 basis points is anticipated, which might lead to a slight strengthening of the peso.
Philip, from your perspective, how do you think these variables could affect the exchange rate? Do you agree with Nilsa’s analysis?
Philip Roberts: Well, as someone from New York City, I have a different viewpoint. While I agree that inflation and interest rates can influence currency exchange rates, I believe that the upcoming presidency of Trump is a key factor to consider. His protectionist policies, including his promises to renegotiate NAFTA and build a border wall, could potentially hurt the Mexican economy. This could lead to capital outflows from Mexico and a weaker peso. Furthermore, the Fed’s decision to cut interest rates could also lead to a weaker dollar, which would further contribute to the weakening of the peso.
Moving on to the following week, what do you think are the main economic references and events that we should be looking out for? And how might they affect the exchange rate?
Nilsa Hernandez: For Mexico, we should pay attention to the 2025 Economic Package and any potential spending cut
