Peso and Mexican stock market advance after US employment data

Mexico City. The Mexican peso appreciated this Friday amid a global decline in the dollar following the release of a weak US labor market report that boosted bets that the Federal Reserve (Fed) would cut interest rates earlier than expected and more strongly.

The domestic currency MXN= was trading at 16.8910 per dollar, with an advance of 0.44 percent against the reference price of Reuters on Thursday, in its third consecutive day of gains. During the week, the peso added a return of 1.45 percent.

Nonfarm payrolls in the United States increased by 175,000 jobs last month, the Department of Labor reported, below expectations of 243,000 and the previous month’s figure of 315,000. Additionally, the unemployment rate rose to 3.9 percent from a level of 3.8 percent.

Following the report, traders increased bets that the Fed will deliver its first rate cut in September, rather than November. The market also now expects two interest rate cuts of 25 basis points this year, up from one before the data was released.

For its part, the Mexican Stock Exchange is also advancing. The leading index S&P/BMV IPC .MXX, which groups the most traded shares in the domestic market, rose 0.37 percent to 56,888.62 points, shortly after the opening. Even so, it accumulated a weekly decline of 1.63 percent.

The titles of the media giant Grupo Televisa TLEVISACPO.MX led the advance on Friday, with 2.92 percent more to 10.56 pesos, followed by those of the cement company Cemex CEMEXCPO.MX, which added 2.10 percent to 13.59 pesos.