Mexican Peso faces sharp decline as geopolitical risks escalate, hawkish comments from Boston Fed's Susan Collins weigh on market mood.
Speculations of imminent Iranian attack on Israel prompt flight to safety.
Fed's Susan Collins revises rate cut expectations, suggesting a cautious approach to monetary easing.
The Mexican Peso plummets sharply against the US Dollar on Friday amid a risk-off impulse on speculation that Iran might attack Israel over the weekend. Alongside surprisingly hawkish comments by Boston Federal Reserve President Susan Collins, these worries derailed the emerging market currency, which could end the week with losses. The USD/MXN trades at 16.68, after hitting a daily low of 16.40, up 1.50%.
US equities are tumbling as sentiment sours. According to CBS News, Israel is bracing for a direct attack on its soil by Iran in retaliation for a strike that killed seven Iranian military officers two weeks ago.
Elsewhere, Boston Fed President Susan Collins said that due to the latest inflation numbers, she expects the Federal Reserve (Fed) to make its first rate cut later than previously thought. She added that she foresees two rate cuts this year instead of the three projected in the Federal Open Market Committee (FOMC) Summary of Economic Projections (SEP).
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