The Mexican peso erased all of Monday’s gains against the US dollar on Tuesday, weakening 0.50% to trade at 18.66 units per dollar, according to Bloomberg data, as the greenback firmed ahead of the Federal Reserve’s upcoming monetary policy decision.
Dollar firms broadly
The move marked a shift of 0.11 pesos from Monday’s close. At Banamex, the dollar was quoted at 19.12 pesos on the selling side and 18.05 pesos on the buying side.
The peso was not alone. The Czech koruna depreciated 0.21%, among the most affected currencies, while the Japanese yen and the euro each fell 0.20%. The Hungarian forint and the Danish krone each slipped 0.19%.
Fed decision looms
The market expects the Federal Reserve to hold its interest rate unchanged at this meeting. Chair Kevin Warsh has avoided offering guidance on future decisions, leaving investors to parse limited signals. The US federal funds rate stood at 3.88% as of 27 October 2026, according to MacroHerald’s own measurement.
Janneth Quiroz, director of economic and FX analysis at Monex, said the exchange rate shows an upward trend and that the implied volatility curve reflects a greater expectation of dollar appreciation in the very short term. Quiroz noted the peso ranks among the top two emerging-market currencies with the largest depreciation against the dollar.
Yields diverge
The 10-year US government bond yield stood at 4.99%. Mexico’s 10-year government bond yield was far higher, at 9.36%, underscoring the gap between the two markets as the Fed decision approaches.
Related: Mexican peso slips as inflation rises and Iran tensions weigh · Mexican peso falls 1.15% to 18.63 per dollar
Data: FRED — St. Louis Fed
