The Mexican Peso was changing hands around $19.30, a level not seen since March 2020 and up over 5% since the beginning of 2022, as an aggressive tightening from the central bank fuelled bets in the currency. The Bank of Mexico hiked its benchmark interest rate by 75 bps to 9.25% in September, adding to the 525 bps increases seen since its tightening path began in June 2021, as inflation in Mexico stands at a 21-year high of 8.7%. Central bank board members stated that inflation risks remain on the upside while forecasting that annual price growth to be at 8.6% by the end of the year. On the dollar side, a softer-than-expected US CPI report reinforced the case for a modest 50 bps hike in December while spooking investors away from the greenback.
Historically, the Mexican Peso reached an all time high of 25.78 in April of 2020. Mexican Peso - data, forecasts, historical chart - was last updated on November of 2022.
The Mexican Peso is expected to trade at 19.65 by the end of this quarter, according to Trading Economics global macro models and analysts expectations. Looking forward, we estimate it to trade at 20.64 in 12 months time.