The Mexican Peso strengthened by 0.58% against the US Dollar, with USD/MXN trading below 20.00, driven by a risk-averse market sentiment and a weakening US Dollar. Federal Reserve Chair Jerome Powell expressed caution regarding inflation, acknowledging downside risks despite a robust labor market, suggesting a potential pause in interest rate hikes. China’s stronger-than-anticipated Q1 GDP data provided support for emerging market currencies, including the Peso, while US restrictions on chip exports negatively impacted the technology sector and the NASDAQ. Despite US tariffs, Sheinbaum affirmed Mexico’s continued role as a key tomato supplier. The USD/MXN pair is currently trading at 19.96. Market sentiment remains subdued due to ongoing tariff concerns. Powell indicated that current monetary policy is appropriately positioned, describing the economy as “solid” despite existing uncertainties. He also noted a likely slowdown in Q1 2025 growth, raising concerns about potential stagflationary pressures, stating that the Fed’s dual mandate is not yet in conflict, but the trend points towards higher unemployment and inflation.
