Mexican Peso Holds Its Ground As IPC Inches Higher Before Fed Verdict

Key Points

• The peso trades near its strongest levels of the year despite a modest dollar rebound.
• Mexico’s IPC index edges higher toward record territory, led by airports, exchange and infrastructure names.
• High real interest rates and nearshoring keep Mexico attractive as global investors trim risk elsewhere.

The Mexican peso was still close to its yearly highs on Tuesday morning, even after the dollar mounted a small counter-attack overnight.

USD/MXN hovered around 18.26–18.28 after Monday’s bounce from the 18.15–18.20 area. The move came alongside a mild rise in the US Dollar Index to just above 99 as traders squared positions before this week’s Federal Reserve decision.

Mexico’s macro backdrop continues to support the currency. Banxico’s policy rate at 7.25 percent, with inflation in the mid-3 percent range, delivers one of the highest real yields in emerging markets and combines with steady nearshoring investment flows.

Domestic fiscal debates have so far not unsettled bond markets. Technically, the four-hour chart shows a relief rally for the dollar inside a broader peso uptrend.

Short-term momentum has recovered from oversold levels, but USD/MXN still trades below key moving averages and under the Ichimoku cloud.

On the daily chart, the pair hugs the lower Bollinger band, suggesting that any push toward 18.35–18.45 is more likely to meet selling than follow-through upside unless the Fed sounds unexpectedly hawkish.

Mexican equities tell a similar tale. The S&P/BMV IPC added about 0.23 percent on Monday to close near 63,500 points, within sight of all-time highs.

Top winners included Grupo Aeroportuario del Pacífico, Bolsa Mexicana de Valores and infrastructure operator PINFRA, with additional support from Fomento Económico Mexicano and Genomma Lab.

On the losing side, pressure fell on Banorte, Grupo Carso and miner Peñoles, while Gentera and Bimbo also slipped. Index charts remain constructive: the IPC holds above its main moving averages and the daily RSI sits in the mid-50s.

With Wall Street softer and oil lower, the message from Mexico is that disciplined policy still earns a premium, though investors will demand higher yields if Washington or Mexico City blinks.

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