FX.co ★ Mexican Peso Near Six-Month High

The Mexican peso advanced to approximately 19.50 per US dollar, marking its strongest position in over six months. This shift comes as investors evaluate recent pricing data and remain optimistic about the reduction of trade tensions. April's headline inflation increased by 3.93% on a year-over-year basis, slightly exceeding expectations, while core prices saw a monthly uptick of 0.49%. These figures suggest that Banxico is likely to proceed cautiously with its expected 25–50 basis points interest rate cut on May 15, in order to maintain a yield advantage over the Fed's steady range of 4.25–4.50%. In addition, preliminary figures for first-quarter GDP growth showed a 0.2% increase, which helped avert a technical recession and underscored the economy's resilience. Furthermore, news of impending discussions between high-level US and Chinese officials in Switzerland this weekend, coupled with signs of a forthcoming US–UK trade agreement, has helped alleviate concerns about extensive tariff impacts on Mexico’s export sectors. The government's latest fiscal support package, which includes targeted cash transfers, increased subsidies, and temporary tax relief for small businesses, is set to further stimulate domestic demand.