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Mexican Peso Breaks Below 17 and Extends Fifth Weekly Gain

U.S. Treasury bond buybacks plus softer U.S. inflation and jobs data have cut dollar demand and revived carry trades that are pushing the peso higher.

Overview

  • The peso fell under MXN 17 on Friday and was trading around MXN 16.90–16.95 as it notched a fifth consecutive week of gains.
  • Market participants say weaker U.S. data and Fed minutes reduced bets on higher U.S. rates, while an expanded Treasury long-term bond buyback eased 10-year yields and lowered demand for dollars.
  • Analysts warn that technical support levels near 16.85 and a deeper zone around 16.5590 could accelerate the peso's move if breached, attracting momentum and carry-trade flows.
  • In Argentina, the mayorista closed near ARS 1,499 while the informal blue rate stayed about ARS 1,550, and the BCRA used futures interventions, higher short-term rates and export dollar inflows to defend the official band and build reserves.
  • Peru’s sol firmed to roughly S/3.345 and regional traders are watching renewed Middle East tensions and rising oil prices as upside risks that could lift global inflation and reverse recent currency gains.