Mexican Markets Show Cautious Start on Inflation and Output Data

Mexico City’s financial center opened Thursday with the peso trading at 18.40 per U.S. dollar, and the S&P/BMV IPC index at 61,906 points. Investors digested August’s unexpected rise in consumer prices and a slight contraction in industrial output.

News agency data confirmed that inflation climbed to 3.57 percent year-on-year in August, stoking speculation that Banco de México will delay further rate cuts despite market expectations.

Meanwhile, industrial production fell 0.3 percent from July, driven by slower manufacturing activity. Retail sales held steady, suggesting consumers remain cautious but resilient.

On Wednesday, traders reacted to Federal Reserve Chair Jerome Powell’s remarks on “two-sided risks” for U.S. inflation and employment.

Those comments halted a slide in the dollar index, which traded near 97.82 as of early EST. A firmer dollar limited peso gains, while mixed outlooks for U.S. durable goods orders added to market uncertainty.

Mexico’s stock market fell 0.74 percent Wednesday amid profit-taking and sector rotations. The top five gainers included Grupo Aeroportuario del Pacífico, Cemex, Grupo Televisa, Alfa and América Móvil, each rising between 0.6 and 1.2 percent.

The leading laggards—Banorte, Grupo México, Wal-Mart de México, GFNorte and Mexichem—suffered declines of 0.5 to 1.1 percent, reflecting mixed earnings outlooks and broader market caution.

In technical terms, the IPC’s daily relative strength index hovered near 66, below the overbought threshold but signaling limited upside before a pullback.

The USD/MXN four-hour chart showed a mild bullish MACD crossover, hinting at a short-term peso recovery if U.S. data disappoints. However, narrowing Bollinger Bands suggest low volatility and a potential breakout in either direction.

Oil prices trended lower overnight on oversupply concerns. Brent crude shed 1.2 percent, tempering support for oil-linked peso flows.

Equity ETFs tracking Mexican shares saw net outflows of roughly USD 45 million as investors rebalanced positions ahead of key U.S. data releases.

Looking ahead, durable goods orders due at 10 a.m. EST could sway the dollar index and emerging-market currencies. Later speeches by Fed officials and Thursday’s Banco de México minutes will offer further insight into the policy outlook.

Overall, markets entered Thursday on edge. A warmer inflation reading and softer output underscore the challenge facing policymakers balancing growth and price stability.

Investors will watch U.S. data closely, seeking clear signals to drive the next leg of the peso and IPC’s journey.