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Mexican peso stays near 17.00 as US-Iran strikes hit risk appetite

USD/MXN was last around 16.99, with the US Dollar Index up 0.27% to 99.68 as traders weigh Fed rate expectations and upcoming US data.

Reported · Written up by our desk · Major Pairs

The Mexican peso pulled back on Tuesday after early gains versus the US dollar as geopolitical tensions between the United States and Iran dulled risk appetite, leaving the USD/MXN pair essentially flat near 16.99.

FXStreet attributed the move to successive strikes involving US targets near the Strait of Hormuz and Iran retaliation reported by Fars, which helped lift the dollar, measured by the US Dollar Index. The DXY was up 0.27% to 99.68.

The dollar’s firmness also reflected incoming US signals that the Federal Reserve could raise rates further, according to the same coverage. The ISM Manufacturing PMI for August stayed in expansion territory at 54.6, down from 55.6, and JOLTS showed hiring of 7.217 million versus a forecast of 7.3 million.

In Mexico, the calendar was lighter as S&P Global reported an August Manufacturing PMI that contracted to 49.8 from 51.3, and traders also looked ahead to Mexico’s consumer confidence release. Separately, Bank of Mexico’s survey of private economists showed most analysts trimmed their 2026 inflation projection to 3.90% from 4.0%, while the economy was expected to grow 1.30% in 2026 and 1.80% in 2027.

Latest closeDollar index 99.65 ▲0.2%

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