Business · Economy · 2 hrs ago
Weaker peso may add pressure to inflation in Mexico
Mexico’s peso weakened against the US dollar, reaching 18.50 pesos per dollar during trading and closing at 18.4111.
A weaker peso means Mexican buyers need more pesos to pay for goods and inputs priced in dollars.
Analysts say higher costs for imported food, fuel, electronics and business supplies may gradually reach consumers and add to inflation.
They say inflation is near 3.4%, but a prolonged fall in the peso could make it harder to bring inflation down and limit the central bank’s room to cut interest rates.
The change also has potential benefits: people receiving money from abroad get more pesos for each dollar, while exporters, manufacturers and international tourism businesses may become more competitive.
The peso has fallen 9% from its year low on September 4, and analysts expect it to fluctuate between 17.80 and 18.50 per dollar toward the end of the year.
Its path will depend on factors including fiscal policy, the US-Mexico-Canada trade agreement, interest-rate decisions and perceptions of Mexico’s risk.
The peso has weakened against the US dollar, reaching 18.50 pesos per dollar during trading.
Analysts say the depreciation could raise inflation by increasing the cost of imported goods and inputs.
The peso closed Friday at 18.4111 per dollar, down 1.15% on the day.
A weaker peso can benefit households receiving money from abroad and businesses in exports, manufacturing and international tourism.
Analysts say prolonged depreciation could make it harder for inflation to slow and limit the central bank’s room to cut interest rates.
- Who
- Mexican consumers, businesses and households receiving money from abroad are affected; analysts Eduardo Ramos and Julián Fernández discussed the effects.
- What
- The peso’s depreciation could increase inflationary pressure, while benefiting some exporters and recipients of money from abroad.
- When
- The peso closed Friday at 18.4111 per dollar after reaching 18.50 during the session. The article was published on 2026-10-12.
- Where
- Mexico.
- Why
- A weaker peso raises the peso cost of imports and dollar-denominated obligations, while increasing the peso value of income received in dollars.
This story does not have two clearly opposing sides.
For companies that depend on imported raw materials or have financial commitments in foreign currency, depreciation implies a considerable increase in their operating and financial costs, which puts pressure on their profit margins.
However, if depreciation continues, slowing inflation becomes more difficult and Banxico’s room to continue lowering interest rates is limited, keeping borrowing costs high.
The peso reached its year-to-date low of 16.8912 per dollar.
The peso closed at 18.4111 per dollar after reaching a session high of 18.5000.
The short-term outlook cited in the article put the exchange rate between 17.80 and 18.50 pesos per dollar, with episodes of volatility.
- Friday close
- 18.4111 pesos per dollar
- Session high
- 18.5000 pesos per dollar
- Daily depreciation
- 1.15%, or 20.86 centavos
- Weekly depreciation
- 1.36%; fifth consecutive week of losses against the dollar
- Year-to-date low
- 16.8912 pesos per dollar on September 4
- Year-to-date change
- The peso had lost 2.23% against the dollar
Sources
Related news
Yucatán reports 11.566 billion pesos in tourism investment
Long-term debt issuance on Mexico’s stock exchange reaches 234.979 billion pesos
Orbia leads Mexican stock gains while Grupo BMV falls most
SpaceX agrees to buy spectrum to expand Starlink mobile service
Mexico debate links between wider credit access and responsible lending
Pemex says fuel supply is normal in Mexico City and State of Mexico
How Tiendas 3B keeps prices low while growing its business
Mexico removes 153,655 counterfeit textile products from the market
Karl Lagerfeld brand unveils first residential project in Mexico
Mexico removes more than 153,000 counterfeit goods from the market
Mexico’s property tax depends on local rules and assessed value
