• Mexican Peso collapses as USD/MXN climbs past 19.50 after bouncing from daily lows.
• IMF predicts Mexico's economy will grow 1.5% in 2024, further deceleration to 1.3% in 2025.
• San Francisco Fed’s Mary Daly hints at possible rate cuts, boosting USD amid a mixed US economic outlook.

The Mexican Peso lost over 1% against the US Dollar during the North American session as the Greenback strengthened on risk aversion. A scarce economic docket in Mexico left traders leaning on US data, which was mixed as inflation expectations edged higher. The USD/MXN trades at 19.66 after bouncing off daily lows of 19.33.

Market sentiment is downbeat and weighed on risk-sensitive currencies like the Peso. In the meantime, the International Monetary Fund (IMF) revealed that Mexico’s economy is expected to grow by 1.5% in 2024, citing capacity constraints and tight monetary policy.

Next year, the economy is foreseen decelerating further to 1.3%, adding that inflation is expected to get closes to the Bank of Mexico’s (Banxico) 3% goal. The Institute said that “inflation risks remain on the upside” and warned that an economic slowdown in the US, geopolitics, and unforeseen impacts from the judicial reform could impact Mexico’s economy.

Across the border, the New York Empire State Manufacturing Index posted a dismal print, while the latest New York Fed Survey for Inflation Expectations in September remained unchanged at 3%.