Mexican Peso holds up despite strong US Dollar, ahead of US PCE data

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• Mexican Peso drops 0.08% amidst US economic data showing continued growth and mixed signals from Mexico.
• Strong US GDP growth for Q4 2023 and stable Durable Goods Orders could impact Fed’s rate decisions, contrasting with a cooling labor market.
• In Mexico, a lower unemployment rate and rising inflation pose challenges for Banxico’s policy direction.

The Mexican Peso (MXN) recovered some ground though is virtually unchanged, printing minuscule gains against the US Dollar (USD) on Thursday after economic data from the United States (US) witnessed the economy continuing to grow above trend, though below last year’s Q3 4.9% final reading. In the meantime, Mexico’s unemployment rate continued to trend lower at a non-seasonally adjusted rate, along with an uptick in inflation in the first half of January, boosting the emerging market currency. At the time of writing, the USD/MXN trades at 17.22, down 0.02% on the day.