Tracking the exchange rate people actually experience
MND Intelligence · Fifth edition
Welcome to the fifth edition of the MND Peso Index™, part of the MND Intelligence™ suite of data products developed by Mexico News Daily.
The MND Peso Index™ is a monthly purchasing power parity measure that assesses whether the Mexican peso is overvalued or undervalued against the US dollar by comparing the prices of a standardized basket of 20 goods and services in Mexico and Dallas, Texas.
As was the case with our previous edition, our latest MND Peso Index™ assessment is being published in the same month as its underlying price survey, making it more timely.
Our headline finding for September 2026 indicates that the peso was overvalued against the dollar by 5.8%, an increase of 3.4 percentage points compared to the 2.4% overvaluation we determined in early August. This is the highest overvaluation assessment the MND Peso Index™ has yielded, surpassing the 4% overvaluation appraisal in May.
For a detailed explanation of the purpose of the MND Peso Index™, the makeup of the basket and more, please refer to the index article we published in June. You can read even more about the index in our introductory article published in early May.
What did the MND Peso Index™ tell us in September 2026?In September 2026, the MND Peso Index™ suggests that the USD:MXN exchange rate on the date we collected prices in various Mexican cities and in Dallas, Texas, overvalued the Mexican peso by 5.8%.
The Mexican and Dallas prices were collected on Sept. 2, 2026. The MND Peso Rate — the simple average of the 20 item-level implied exchange rates, rather than the rate produced by dividing the total Mexican basket cost by the total Dallas basket cost — came in at 17.96 pesos per dollar, compared with a Banxico FIX rate of 16.98 pesos per dollar on Sept. 2.
(Mexico News Daily)The gap between those two figures indicates that the peso — at a rate of 16.98 to the US dollar — was overvalued by 5.8% in early September.
In the table below, you can see the Mexico and U.S. prices for all 20 goods and services in the basket, the total costs of the two baskets, the implied exchange rate for each item, the MND Peso Rate (i.e., the overall implied rate), the Banxico FIX rate on the date prices were collected and the overvaluation assessment for the peso.
Why did the peso’s ‘overvalued’ assessment increase between August and September?The peso’s overvaluation assessment increased from 2.4% in early August to 5.8% in early September because the gap between the Banxico FIX rate and the MND Peso Rate widened.
The widening occurred due to the appreciation of the peso between Aug. 6 and September 2 and due to an increase in the MND Peso Rate. The peso appreciated 24 centavos from 17.22 to 16.98 over that period, a strengthening of 1.4%. The MND Peso Rate increased 32 centavos from 17.64 on Aug. 6 to 17.96 on Sept. 2. The difference between the Banxico FIX rate and MND Peso Rate on Sept. 2 was 98 centavos, an increase of 56 centavos compared to the gap between the two rates on Aug. 6.
The peso has recently appreciated due to a range of factors, including US dollar weakness and carry trade demand for Mexico’s currency. The MND Peso rate increased due to eight month-over-month changes in the implied rates for items in the basket of goods and services.
The implied rates increased for six items: A Big Mac, a Big Mac meal, a dozen eggs, Kirkland toilet paper, Listerine mouthwash and a Planet Fitness membership. In the case of the Big Mac and the Big Mac meal, the implied rate rose because prices in Dallas fell. In the case of the eggs, toilet paper and mouthwash, the implied rate increased because prices in Mexico rose. The price of a Planet Fitness membership declined in both Dallas and Mexico. However, the Dallas price fell more than the Mexico price, causing the implied rate to increase.
The implied rate for a cinema ticket declined because the price fell on both sides of the border, but the decrease in Mexico was larger. The eighth month-over-month implied rate change was due to the replacement of a Flexon Hose — which is no longer available on Costco México’s website — with a set of glass containers. The implied rate for the set of glass containers was 21.64, while the implied rate for the hose last month was 24.26.
Overall, the combined upward effect of the six higher implied rates outweighed the downward effect of the two lower rates. Thus the MND Peso Rate increased between early August and and early September.
The MND Peso Index™ has now found the peso to be overvalued in April, May, June, August and SeptemberThrough the use of the MND Peso Index™, we have now determined that the peso was overvalued against the US dollar by 2.8% in late April, 4% in late May, 2.9% in late June, 2.4% in early August and 5.8% in early September.
The difference between the lowest overvaluation assessment (that in August) and the highest one (this one) is 3.4 percentage points.
(Mexico News Daily)So far in 2026, the peso has appreciated 6.4% against the US dollar. It closed at 18.00 to the greenback on the final day of 2025, according to the Bank of Mexico, while the closing USD:MXN rate on Tuesday, Sept. 8 was 16.91. If the Banxico FIX rate was 16.91 when we collected the prices for the Mexican and Dallas baskets on Sept. 2, the overvaluation assessment for the peso would have been 6.2%.
* Price sources: Mexico prices were collected from the websites and apps of Walmart México, Costco México, AutoZone México, Telmex, Cinépolis, Petco México, McDonald’s, Starbucks, Netflix, Spotify and Microsoft. Dallas prices were collected from their U.S. equivalents. The Banxico FIX rate of 16.98 published on Sept. 2, 2026, was used as the official exchange rate reference.
The post The MND Peso Index™ for September: MXN is nearly 6% overvalued against USD appeared first on Mexico News Daily