The Mexican peso continued its hot streak on Monday, appreciating to its strongest level against the dollar in almost nine years.

After strengthening on Friday to close at 16.46 to the greenback, the peso appreciated around 1% to reach 16.30 to the dollar on Monday, its strongest position since August 2015.

The currency subsequently weakened slightly to close at 16.33, according to the Bank of Mexico.

Asserting that the Mexican peso had “eclipsed” the US dollar on a day on which the moon totally obscured the view of the sun from parts of North America, the El Financiero newspaper reported that the peso was the world’s best-performing emerging market currency in Monday trading.

Gabriela Siller, director of economic analysis at Mexican bank Banco Base, said on the X social media platform that the appreciation of the peso was due to three factors.

She cited the inflow to Mexico of foreign currencies from exports, remittances and direct foreign investment (FDI); the “expectation” that the wide gap between interest rates in Mexico and the United States “will attract capital to Mexico”; and the “expectation” that nearshoring “will attract waves of dollars” to Mexico due to an increase in FDI and exports.

The peso also got a boost from a general weakening of the dollar, as shown by a slight decline on the DXY index, which measures the value of the greenback against a basket of foreign currencies.

The peso has benefited for an extended period from the difference between the Bank of Mexico’s key interest rate — currently set at 11% after a 25-basis-point cut last month — and the 5.25%-5.5% rate of the United States Federal Reserve. The March 21 decision by the Bank of Mexico board to reduce rates hasn’t had an adverse impact on the peso despite a narrowing of that gap.

In fact, the peso has appreciated around 2.5% since the interest cut was made. Compared to the beginning of last year when one dollar was buying around 19.5 pesos, the gain for Mexico’s currency is almost 20%.

With inflation still above the Bank of Mexico’s 3% target, interest rates are expected to remain high in Mexico for some time. Inflation data for the entire month of March will be published later this week.

With reports from El Financiero, El Informador, El País and Aristegui Noticias