Peso Dips, BMV Rises Ahead of Fed & Banxico Moves

Mexico City — The Mexican market opened this Thursday with mixed movements. While the Mexican peso weakened against the dollar, the Mexican Stock Exchange (BMV) managed to reverse losses, reflecting global uncertainty and anticipation regarding upcoming monetary policy decisions.

The Story Behind the Markets: The Peso-Dollar Pulse

In early morning trading, the Mexican currency depreciated by 0.31% against the dollar, settling at 18.46 pesos per unit. The decline occurs in a context marked by solid employment and economic growth data in the United States, which reinforced bets that the Federal Reserve (Fed) will be more cautious with interest rate cuts. This scenario strengthens the dollar, whose DXY index advanced 0.32% to 97.820 units, directly impacting emerging currencies like the Mexican peso.

Banxico at the Center of Attention

Investors are awaiting the monetary policy decision from the Bank of Mexico (Banxico). The consensus points to a cut of 0.25 percentage points, which would bring the rate to 7.50%. Beyond the adjustment, the market awaits the authority's message about the future trajectory of rates, key to understanding the balance between inflation and economic growth in Mexico.

The United States Sets the Pace

US GDP surprised with an annualized growth of 3.8%, the highest rate in nearly two years. These figures strengthen the view that the economy remains resilient, which could limit the Fed's rate cuts in the coming months. The yield on 10-year Treasury bonds settled at 4.19%, putting pressure on equity markets. Wall Street reflected the tension: the Nasdaq fell 1.25% and the S&P 500 retreated 0.90%.

BMV and Oil: Lights and Shadows in the Market

In contrast, the BMV advanced 0.42% to 62,150 points, approaching historic highs. This rebound responds to the selective appetite of investors for Mexican assets, despite international volatility.

Another key factor is oil. Brent reached close to 70 dollars, driven by lower inventories in the US and geopolitical tensions. However, this Thursday it moderated its rise, trading near 69 dollars per barrel.

Gold and Havens: The Retreat Against the Dollar

Gold, a traditional haven in times of uncertainty, halted its record streak and adjusted to 3,758 dollars per ounce. The strength of the dollar and the expectation of higher rates reduced its short-term appeal.

A Look at the Immediate Future

Markets will be watching the Fed's favorite inflation indicator, which will be published tomorrow. Any upside surprise could reignite volatility and reconfigure investor bets.

In Mexico, the narrative will depend on Banxico's message. The dilemma between containing inflation or giving more room for growth will set the course for the peso and the BMV in the coming days.