The best time to trade the Mexican peso (MXN) is usually in the morning, when many financial markets are open and a steady stream of news is flowing. The currency is not in the top 10 based on global liquidity and is well behind the U.S. dollar (USD), euro (EUR), Japanese yen (JPY), and British pound sterling (GBP). Traders typically focus on the peso in relation to other currencies, and the USD/MXN currency pair accounts for the bulk of activity in the peso.
Key Takeaways
- The Mexican peso (MXN) is not as actively traded as the euro or the U.S. dollar (USD), but the currency offers highly liquid access to Latin American markets.
- The USD/MXN currency pair accounts for the bulk of trading activity in the peso.
- The best time for MXN trading is typically in the morning, when financial markets are open and there is a steady flow of economic news.
- Bid-ask spreads tend to widen during quiet periods and narrow when trading is more active.
U.S. Dollar vs. Mexican Peso
In recent decades, the Mexican peso has transformed from a sleepy developing-world currency into an international financial instrument. While the USD/MXN pair attracts fewer participants than other major currency pairs, such as the euro (EUR/USD) and yen (USD/JPY), it offers highly liquid access to Latin America, as well as opportunities created by emerging market growth and weakness.
The USD/MXN currency pair trades continuously from Sunday evening to Friday afternoon in the United States, offering significant opportunities. However, volume and volatility can fluctuate greatly in each 24-hour cycle, with spreads (the difference between bids and asks) widening during quiet periods and narrowing during active periods. While the ability to open and close positions at any time marks a key benefit of the foreign exchange (forex) market, the majority of trading strategies unfold during active periods.
Mexican Peso Price Catalysts
As a top-15 oil-producing country, Mexico is tied to its natural resources, with the peso showing a tight correlation with other commodity-based currencies, including the Brazilian real(BRL) and the Colombian peso (COP). This interdependence increases the importance of energy fluctuations as well as of data that moves crude oil and natural gas futures markets. The weekly U.S. oil inventory report, released at 10:30 a.m. ET on Wednesdays, can have a particularly strong effect on USD/MXN.
The best times to trade the Mexican peso track the release of economic data as well as open hours at equity, options, and futures exchanges. Planning ahead requires two-sided research, because local and U.S. catalysts will move USD/MXN with equal intensity. In addition, the peso will often trade in lockstep with other commodity crosses, with energy and natural resource catalysts on the other side of the planet impacting local price action.
Banco de México meets eight times per year to address monetary policy and announce policy updates through press releases. The majority of meetings are scheduled 24 to 72 hours after the U.S. Federal Reserve issues its decisions, highlighting the interdependence between the two nations. Forex traders need to stay alert on release day, because the policy update can come at any time.
Interest Rate Update
On June 25, 2021, Banco de México raised interest rates from 4.00% to 4.25%. Analyst expectations had been for unchanged.
Economic Releases
The majority of Mexico’s economic data is released at 9 a.m. or 10:30 a.m. ET. The time segment from 30 to 60 minutes prior to these releases and one to three hours afterward is an enormously popular period to trade USD/MXN, because it also overlaps with the start of the U.S. trading day, drawing in significant volume in both venues.
U.S. economic releases at 8:30 a.m. and 10 a.m. ET generate extraordinary trading volume as well, with high odds for trending movements. USD/MXN volume drops precipitously between Asian and European market hours, but energy-based data can still trigger a flurry of trading activity.
Equity Exchange Hours
Mexican peso trading schedules roughly follow U.S. exchange hours, increasing activity when New York equity markets and Chicago futures and options markets are open for business. This localization generates an increase in trading volume when the sun rises in the U.S. and continues into the late afternoon hours.
Central bank agendas can shift this activity cycle, with forex traders staying at their desks when the Federal Reserve’s Federal Open Market Committee (FOMC) releases interest rate decisions or minutes from prior meetings. The European Central Bank (ECB) can also cause a spike in MXN activity, especially when the highly popular EUR/USD pair experiences a substantial move.
The Bottom Line
The USD/MXN forex pair offers Mexican peso traders a variety of short- and long-term opportunities. The best times to trade this instrument are before and after U.S. economic releases, usually scheduled at 8:30 a.m. and 10 a.m. ET. This reporting schedule keeps the forex pair active and liquid throughout much of the U.S. equity and futures exchange hours.
FAQs
The USD/MXN currency pair accounts for the bulk of trading activity in the peso. The best time for MXN trading is typically in the morning, when financial markets are open and there is a steady flow of economic news. Bid-ask spreads tend to widen during quiet periods and narrow when trading is more active.
How do I get the best exchange rate for Mexican pesos? ›
Visit a local bank during regular business hours to exchange your foreign currency for Mexican Pesos. Authorized Exchange Offices: Look for authorized exchange offices or "casas de cambio" in tourist areas. Those establishments are specialized in currency exchange and typically offer competitive rates.
What is the prediction for the Mexican peso? ›
The Mexican Peso is expected to trade at 19.85 by the end of this quarter, according to Trading Economics global macro models and analysts expectations. Looking forward, we estimate it to trade at 20.27 in 12 months time.
Is it better to exchange pesos in US or Mexico? ›
Is it better to exchange money in US or Mexico? Whether you exchange money at US banks or Mexican banks, rates will be costly. The better option is to use Wise to exchange and hold Mexican Pesos with no hidden fees, which can be done instantly and digitally from your smartphone.
What is the best exchange rate MXN to USD? ›
Email me when
| 1 MXN to USD | Last 30 days | Last 90 days |
|---|
| High | 0.0537 | 0.0568 |
| Low | 0.0500 | 0.0500 |
| Average | 0.0515 | 0.0535 |
| Change | -4.44% | -7.65% |
1 more rowThe best time for MXN trading is typically in the morning, when financial markets are open and there is a steady flow of economic news. Bid-ask spreads tend to widen during quiet periods and narrow when trading is more active.
Is $100 a lot of money in Mexico? ›
With today's exchange rates, $100 USD is about $1,900 – $2,000 MXN. Compared to wages, $1,900 MXN is about weeks' worth of salary for most manual labor jobs outside the major cities of Mexico. So for locals that have basic day labor jobs, it is a decent amount of money.
What is the Mexican peso prediction for 2024? ›
If oil prices continue to rise, interest rates remain high, and Mexico's economy remains strong, analysts predict a further strengthening of the peso. Economy Forecast Agency (EFA) specialists believe we will see 15-1 territory in 2024. And the Wallet Investor portal predicts next year will close out around 16-to-1.
Is the dollar strong in Mexico right now? ›
US Dollar to Mexican Peso Exchange Rate (I:USDMPENK)
US Dollar to Mexican Peso Exchange Rate is at a current level of 19.74, down from 19.92 the previous market day and up from 17.26 one year ago. This is a change of -0.89% from the previous market day and 14.39% from one year ago.
How much is $1 US in Mexico today? ›
1 USD = 19.954276 MXN Sep 11, 2024 10:05 UTC
Check the currency rates against all the world currencies here. The currency converter below is easy to use and the currency rates are updated frequently.
Mid-range Travellers. Those with a little more money to spare may find that an average daily budget of $2,400 Mexican Pesos (MXN) is the perfect amount. This will get you a comfortable mid-range hotel room, allow you to travel by taxi, and give you the opportunity to enjoy three-course meals in most restaurants.
Where is the best place to exchange Mexican currency? ›
Using your bank's ATM, or an ATM in its network, and exchange providers like Travelex are common options. Another option is to use companies such as Wise, which specializes in currency transfers and offers a debit card.
Is it better to tip in Mexico dollars or pesos? ›
It's best to tip in pesos in Mexico. Tipping in U.S. dollars creates an added hurdle for the person receiving the tip; they then need to find somewhere to exchange dollars for pesos and pay a fee to do so.
What is the cheapest way to exchange USD to Mexican pesos? ›
Local banks and credit unions usually offer the best rates. Major banks, such as Chase or Bank of America, often offer the added benefit of having ATMs overseas. Online peer-to-peer foreign currency exchanges. Online bureaus or currency converters, such as Travelex, provide convenient foreign exchange services.
How much is $100 USD in MXN? ›
US Dollars to Mexican Pesos conversion rates
| USD | MXN |
|---|
| 100 USD | 1,912.68 MXN |
| 500 USD | 9,563.40 MXN |
| 1,000 USD | 19,126.81 MXN |
| 5,000 USD | 95,634.09 MXN |
7 more rowsThe US dollar is widely accepted in tourist areas and large cities across Mexico. However, you may need Mexican pesos for transactions in rural areas, local markets, and with smaller vendors.
Where is the cheapest place to exchange pesos? ›
Local banks and credit unions usually offer the best rates. Major banks, such as Chase or Bank of America, often offer the added benefit of having ATMs overseas. Online peer-to-peer foreign currency exchanges. Online bureaus or currency converters, such as Travelex, provide convenient foreign exchange services.
What is the best way to exchange money before going to Mexico? ›
Before your trip, it's best to do a currency exchange at your bank or credit union, which likely offers better rates and fewer and/or lower fees. Your bank or credit union may buy back leftover foreign currency in exchange for dollars when you return.
How much is $1 US in Mexico? ›
Is it better to exchange currency at home or abroad? ›
Ordering currency from your bank before you travel is almost always better than using the airport currency exchange. Sally French is a travel rewards expert who joined NerdWallet in 2020. She previously wrote about travel and credit cards for The New York Times and its sibling site, Wirecutter.
