Mexico's peso steadied around 18.38 per dollar on Friday morning while the S&P/BMV IPC hovered near 60,819 after a 0.11% dip on Thursday.
The calm masks a tougher backdrop: the U.S. Dollar Index is holding near 99.4, and U.S. 10-year yields are sitting around 4.14% -- levels that usually cool risk appetite across emerging markets.
What happened and why it matters:
Traders kept USD/MXN boxed in a narrow 18.32-18.43 range overnight. Mexico's appeal lies in a tidy macro mix: September inflation at 3.76% remains inside Banxico's target band, giving the central bank room to ease gradually without undercutting the currency.
That credibility -- plus steady U.S. demand for Mexican exports -- has helped the peso hold its ground even as the global dollar stays strong.
On equities, Thursday looked more like a pause than a break. The IPC is consolidating after this week's swings.
International money hasn't left -- Mexico's ETF complex still shows net creations over the past 12 months -- but a firmer dollar is keeping the upside in check.
Top Movers -- S&P/BMV IPC (Thursday Close)
Winners (5):
1. Grupo México (GMEXICOB) +2.37%
2. Grupo Carso (GCARSO A1) +2.31%
3. Grupo Bimbo (BIMBO A) +1.84%
4. Walmart de México (WALMEX) +1.32%
5. América Móvil (AMX L/M) +0.5% (approx.)
Losers (5):
1. Gentera (GENTERA) -3.39%
2. Regional/Banregio (RA) -2.69%
3. Megacable (MEGACPO) -2.31%
4. Alsea (ALSEA) -2.16%
5. ASUR (ASUR B) -1.95%
The story behind the story:
Mexico's edge is balance -- credible inflation control, cautious rate cuts, and supply-chain links to the U.S. That mix limits downside when the dollar is bid, but it also caps upside until the greenback cools.
Technically, USD/MXN is neutral on 4-hour charts (RSI near 50; bands tight) and still capped below 18.50-18.60 on daily charts. The IPC holds above key support at 60,300-60,700; reclaiming 61,100-61,300 would relieve pressure.
What to watch next: Any softening in U.S. data -- or a pullback in the dollar -- would give the peso and Mexican shares room to breathe.
If the dollar pushes higher, expect range-bound, cautious trade, with Mexico's fundamentals continuing to act as a cushion rather than a catalyst.