Mexican Peso slips from multi-year lows, reacting to optimistic US growth figures and labor market resilience.
Strong US GDP growth in Q4 2023 and a robust labor market boosted the US Dollar, a headwind for the Mexican currency.
Fed’s Waller remains hawkish, adhering to the “higher for longer” mantra.
The Mexican Peso was on the defensive against the US Dollar on Thursday, with buyers capitalizing on the exotic pair's dip toward an over eight-year low of 16.51. Hawkish comments by Federal Reserve (Fed) Governor Christopher Waller and an absent Mexican economic docket sponsored a leg up in the USD/MXN. At the time of writing, the pair trades at 16.62, up 0.50%.
In addition to Fed speeches, US economic data has been the main driver of price action. The US Bureau of Economic Analysis (BEA) revealed that the US economy grew above estimates in the last quarter of 2023, as measured by the Gross Domestic Product (GDP). At the same time, a report by the US Bureau of Labor Statistics (BLS) portrayed a tight labor market, with fewer Americans applying for unemployment benefits.
Further data showed an improvement in the housing market as Pending Home Sales recovered in February from January.
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