Peso Drops Below 17 to Dollar for Second Time in a Week

The Mexican peso has experienced its second dip below 17 to the US dollar in just one week, buoyed by a weaker greenback. The USD:MXN exchange rate hit 16.97 on Wednesday morning, according to Bloomberg.

This appreciation comes after the currency broke the 17-unit-per-dollar floor last Friday, but closed at 17.03 to the dollar on the same day, and was also above 17 at the end of trading on Monday and Tuesday.

Gabriela Siller, director of economic analysis at Banco Base, attributes the peso's gain to 'the weakness of the dollar' resulting from the US Treasury Department's announcement to increase a bond buyback operation. The greenback weakened after the Treasury Department announced it was increasing, by at least double, the size of liquidity support buyback operations for longer-dated nominal coupon securities.

Janneth Quiroz, director of economic analysis at the Monex financial group, agrees that the peso benefited from 'the retreat of the dollar' and the United States' decision to pause planned 50% tariffs on almost $30 billion worth of Canadian goods.