USD/MXN reaches record highs near 20.00

USD/MXN is rising sharply on Friday, extending weekly gains to more than 4.50% and it printed new all-time highs at 19.77. From the highs, the pair pulled back modestly and it was trading at 19.66. The previous intraday record high was reached back in June 24 at 19.51.

The Mexican peso is the worst performer in the currency market on Friday and also during the week. The decline in crude oil prices and US election polls showing Trump rising, contribute to weaken the peso.

Also, the US dollar is rising in the market amid risk aversion. European markets finished lower and equity prices in Wall Street are falling. Today is a holiday in Mexico and its stock market is closed.

What would Banxico do?

Mexico’s central bank (Banxico) rose interest rates twice during 2016 after sharp depreciations of the peso. If the decline continues, the central bank could implement measures to curb the slide. The next (ordinary) meeting of Banxico is September 29, 8 days after the Fed’s decision.