Bad Thursday for the Mexican peso which, after several favorable days in its downtrend, closed today with a 3.92% drop, trading at the level of 22.73 pesos per dollar and today being the first day, since the past June 1, when the exchange rate closes above 22 units per dollar. This is also the largest daily depreciation for the local currency since March 16. The currency was mainly affected by an increase in the perception of global risk, generalized in the stock markets that also closed in the red. The three main Wall Street indexes ended the day with sharp falls this Thursday; while the S & P / BMV IPC of the Mexican Stock Exchange, made up of the 35 most liquid companies in the market, fell by 3.76%.
The negative macroeconomic data published today in Mexico also influenced the depreciation of the local currency. Industrial activity in Mexico suffered a historical contraction in April, mainly as a result of a negative performance in the construction and manufacturing sectors due to the coronavirus. The Monthly Industrial Activity Indicator (IMAI) registered a real drop of 25.1%. There is a perception that the markets could be entering the economic “real reality” after several weeks of excessive optimism, caused by the progressive reopening of global economies after the confinement of the Covid-19 coronavirus.
“The Mexican peso is among the most depreciated today in the face of a new wave of those infected in the United States that has generated a greater perception of global risk,” explained Gabriela Siller, director of Economic and Financial Analysis at Banco Base. “The rebound in the exchange rate is also due to comments by Jerome Powell after the Fed’s monetary policy announcement yesterday afternoon, where he pointed out that there are risks to economic activity and that, for this reason, they will maintain the interest at its all-time low during 2020 and at least two more years, “added Siller.