Mexican peso holds strength below 17 per US dollar

The Mexican peso has maintained a position below the 17 per US dollar threshold for five consecutive sessions, trading near decade-high levels against the greenback. This strength is attributed to a combination of factors, including a general weakening of the US dollar, high interest rate differentials that attract carry trade investors, and robust flows from manufacturing exports, remittances, and foreign direct investment.

Market volatility is being influenced by geopolitical tensions in the Middle East and trade uncertainties in North America, specifically regarding potential tariffs between the United States and Canada. Investors are also closely monitoring upcoming economic data and central bank communications from the Federal Reserve at Jackson Hole.

Separately, Banco de México reported a weekly increase in international reserves of $1,192 million, bringing the total balance to $258,609 million as of August 21, 2026. This growth was driven by asset valuation changes and dollar sales from the Mexican Petroleum Fund.