Daily digest market movers: Mexican Peso stays firm amid lack of catalysts

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  • Mexican political turmoil eases as market participants prepare for the change of president on October 1, a bank holiday in Mexico. President-Elect Claudia Sheinbaum’s speech will be watched for hints about her economic plan.
  • USD/MXN whipsawed and erased earlier losses, boosted by the buck’s recovery.
  • Banxico is expected to lower borrowing costs by 175 bps toward the end of 2025, according to the swaps markets.
  • US Dollar Index (DXY), which tracks the buck’s performance against a basket of six peers, is virtually unchanged at 100.90.
  • Market participants have fully priced in at least a 25 bps rate cut by the Fed. However, the odds for 50 bps of easing are 51.3%, lower than the 60% chance a day ago, according to the CME FedWatch Tool.

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