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LatinNews Daily - 15 February 2021

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In brief: Mexican peso strengthens

*The Mexican peso traded at M$19.96/US$1 at the close of the day in local financial markets on 12 February. The exchange rate represents a 0.84% appreciation of the peso compared to the previous week and the second time that the exchange rate has fallen below the M$20/US$1 threshold since November 2020 after doing so last month. This is a sign of growing market confidence in the Mexican economy and has been attributed to the US Federal Reserve’s announcement that it will maintain its current expansionary monetary policy in support of economic recovery in the US. The appreciation of the peso also came despite the decision by Mexico’s central bank (Banxico) to cut its benchmark interest to the lowest level since 2016 in the hope of stimulating the domestic economy.