by El Reportero‘s wire services
The Mexican peso weakened to as low as 17.08 to the US dollar on Tuesday morning, a depreciation of around 4.6 percent compared to the 16.30 level it reached just over a week ago.
Bloomberg data shows that the peso was trading at 17.08 to the greenback just before 9 a.m. Mexico City time before appreciating to reach 17.00 at midday.
The low point represented a depreciation of 2.1 percent compared to the peso’s closing position on Monday of 16.72 to the dollar.
Janneth Quiroz, director of analysis at the Monex financial group, said on the X social media platform that the peso was affected by “an increase in aversion to international risk.”
Investors are “nervous” as they await a response from Israel to the recent attack by Iran, she wrote.
The DXY index, which measures the value of the US dollar against a basket of foreign currencies, was up slightly at midday.
On Tuesday morning, investors were also waiting for further clues about the United States Federal Reserve’s monetary policy intentions ahead of a speech by the central bank’s Chair Jerome Powell.
Speaking at a policy forum, Powell noted that the U.S. economy was strong, but inflation hadn’t receded to the Fed’s 2 percent goal.
Until inflation shows progress in moving toward that target, “we can maintain the current level of restriction for as long as needed,” he said.
His remarks pointed to “the further unlikelihood that interest rate cuts [in the U.S.] are in the offing anytime soon,” CNBC reported.
The peso has benefited for an extended period from the broad gap between the Bank of Mexico’s key interest rate — currently 11 percent after a 25-basis-point cut last month — and that of the Fed, set at a range of 5.25 percent-5.5 percent.
The peso has also benefited from strong inflows of remittances and foreign investment. The currency began the year at just over 17 to the dollar before appreciating to reach its strongest position in almost nine years on April 8.
Gabriela Siller, director of economic analysis at Mexican bank Banco Base, noted on X on Friday morning that the USD:MXN exchange rate was once again above 17, adding that “with this, the peso erases its gain this year.”
With reports from El Financiero and Aristegui Noticias.
The US will give Ecuador 10 million dollars for security
Ecuador and the United States signed today in this capital a letter of intent through which the northern nation undertakes to deliver 10 million dollars to the South American government to combat drug trafficking and organized crime.
The document was signed by the Ecuadorian Foreign Minister, Gabriela Sommerfeld, and the chargé d’affaires of the Washington embassy in Quito, Lawrence Petroni.
The White House representative noted that Joe Biden’s administration is committed to the Ecuadorian authorities in their efforts to combat drug trafficking, corruption, money laundering and other transnational crimes.
Petroni reported that teams from the two countries will meet in the coming weeks to review the impacts and results of bilateral cooperation.
Sommerfeld, for her part, specified that the additional funds will be allocated to three projects that are underway: fight against transnational organized crime, citizen security and support for public order, and strengthening the capacity and reform of the judicial sector.
On February 15, President Daniel Noboa ratified two agreements agreed with Washington on security matters that are questioned by social organizations and experts.
Through two executive decrees, the president confirmed the entry into force of the agreement relating to the Statute of Forces and the Agreement on Operations Against Illegal Transnational Maritime Activities.
After the signing of these agreements and after the visit of various senior officials of the US government, different voices spoke out against this approach due to its implications for the sovereignty of the South American country.
Despite the agreements and US financing starting in January, when Noboa decreed the internal armed conflict and a state of emergency that lasted 90 days, in Ecuador the levels of insecurity and violence remain high.
On Wednesday night, for example, criminals shot José Sánchez, mayor of the Ecuadorian municipality Camilo Ponce, who joined the list of public servants murdered in this South American nation.
