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Mexican Peso Overcomes Negative Influence of Fed Announcement

March 20, 2014 at 22:50 by Vladimir Vyun

A heap of 100-peso billsThe Mexican peso advanced today even as the prospects for an interest rate hike from the Federal Reserve next year were hurting most currencies of emerging markets as well as other risky assets.

The Fed announced another stimulus cut yesterday and signaled that borrowing costs may reach 1 percent next year. The news hurt most high-beta currencies as it means less cheap money for the world financial system. Yet the peso weathered the negative impact of the announcement rather well today, perhaps because the United States are the biggest trading partner of Mexico and signs of growth in the Northern American country improve prospects for Mexican exports.

USD/MXN went down from 13.2602 to 13.2549 as of 22:50 GMT today.

If you have any questions, comments, or opinions regarding the Mexican Peso, feel free to post them using the commentary form below.

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