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July 14, 2018
The dollar demand is also reflected in the exchange rate, due to the fact that there is less seasonal liquidity in the foreign exchange market because of the Effect of the summer.
Photo: Notimex
During the week that ended, the peso closed with an appreciation of 0.75% or 14.4 cents, and quoted around 18.89 pesos per dollar , after touching a minimum of 18.7581 pesos per unit, According to Banco Base, even though the market expects the peso to continue to appreciate over the next few weeks, the recovery rate of the national currency was lower and the rate of the change was not consolidated below the key level of 19.00 pesos for one dollar
The above, because, below this level, there has been an increase in companies' demand for dollars as a hedge. There are still risk factors for exchange rate stability in the second half of the year.
The demand for dollars is also reflected in the exchange rate, due to the lower seasonal liquidity in the foreign exchange market due to veran effect o
Although the appreciation of the currency Mexican was moderate, at the Chicago Futures Market (CME), there was a reduction in bets against the peso.
In the week between 4 and 10 July, speculative positions pending a depreciation of the peso fell by 30.14% or 16,000,547 contracts, each of 500,000 pesos, while positions in waiting for an additional recovery of the peso rose 9.32%. One hundred or five thousand 670 contracts
As a result of the above, Banco Base does not rule out the peso regaining ground over the next few weeks, when it approaches support of 18.50 pesos for one dollar.
Exchange rate volatility was speculation related to the US-China trade war
after the US Trade Representative's Office released a list of goods imported from the United States on Tuesday. United. Asian country worth $ 200 billion, which will impose a 10% tariff after August 30 next.
In case of entry into force of this measure, the neighboring country of the north could tax a total of 250 billion imports from China, accounting for about 50% of total US imports into from this country.
This would further increase US inflation, increasing the likelihood that the Federal Reserve will accelerate its interest rate normalization process this year.
By the end of the week, market participants were waiting for a meeting between the Secretaries of State, the Treasury and the US National Security, with the winning candidate in the presidential contest, Andrs Manuel Lpez Obrador.
After the meeting, US Secretary of State, Mike Pompeo, told Lopez Obrador that the senior officials' visit to the level is a sign that his country highly values the relationship with Mexico and that although There have been complications between the two countries, Donald Trump is determined to improve and strengthen the relationship.
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