Mexico City. While waiting for the US Federal Reserve (Fed) to clearly open the door today to a cut in interest rates in September, and after the rate hike by the Bank of Japan, which adds news to the session this Wednesday, the Mexican peso moderates its two-day losses against the dollar, which is falling worldwide.
At the opening of the American markets, the dollar fell against the Mexican peso. The Mexican currency appreciated 0.23 percent, to trade at around 18.71 units per dollar. Meanwhile, the dollar index, which measures its performance against a basket of six international currencies, lost 0.56 percent, to 103.742 units.
The spotlight is now on the most important macroeconomic event of the week, the meeting of the US Federal Reserve, which will conclude before the close of the American markets, where it is expected, unless there is a surprise, that the US central bank will confirm that it will leave interest rates unchanged (between a range of 5.25 and 5.50 percent). Analysts expect that today’s meeting will include some hint from the Fed that will clearly open the door to a rate cut in September.
While waiting for the Fed, the Bank of Japan already announced that it has raised its interest rate to around 0.25 percent from the previous range of zero to 0.1 percent it set in March, bringing the rate to its highest level since 2008. Still, the central bank notes that the real interest rate remains significantly negative, while accommodative financial conditions will continue to strongly support economic activity. In addition, the central bank announced that it will halve the amount of its monthly bond purchases starting in 2026, to 3 trillion yen in January-March 2026 from the current pace of around 6 trillion yen.
It is worth recalling that this month there appears to have been an intervention by the Japanese monetary authorities to halt the weakening of the yen, causing a revaluation of the risk of borrowing in yen.
Many peso-yen carry trade positions have thus been unwound, implying significant sales of pesos and purchases of yen. Hence, part of the current weakening of the peso, according to analysts at Franklin Templeton Mexico.
Stocks and oil on the rise
The move was greeted with gains of 1.59 percent on the Nikkei in Tokyo. Buying has spread to China, amid renewed hopes for new macroeconomic stimulus, reaching 2.06 percent in Shanghai.
On Wall Street, gains were recorded in the three main US stock indices, with the Nasdaq up 2.25 percent, the S&P 500 advancing 1.46 percent and the Dow Jones up 0.17 percent.
For its part, the Mexican Stock Exchange (BMV) gained 1.47 percent at its opening, trading at around 53,094 points.
The possibility of a boost to the recovery of China, the world’s largest importer of crude oil, accentuates the upward pressure exerted by geopolitical tensions on the price of oil. The barrel of Brent rebounds and returns to hover around $80, with a gain of 2.86 percent this morning, to $80.30, in the face of news of the death of the leader of Hamas in an attack in Iran. The West Texas barrel, the reference in the United States, reaches $77, with a gain of 3.12 percent, to $77.06.
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– 2024-08-02 23:37:32
