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After the Mexican peso’s worst start to a year, options traders are paring back wagers on further declines.

Bearish bets on the peso outnumbered bullish contracts last week by the least since April, according to data from the Commodity Futures Trading Commission, showing that speculation is rising that the peso’s recent rally will continue. Since tumbling a record 13 percent in the first three quarters of 2015, the tender has advanced 1.8 percent this month, gaining with most Latin American currencies.

The peso has rebounded amid wagers the Federal Reserve will delay raising borrowing costs, leading traders to unwind bets that the currency would decline as higher U.S. interest rates sapped investment from emerging markets. In July, Mexico quadrupled a daily dollar sales program to bolster the peso after it fell to a record, and policy makers have since extended intervention measures through November.

“The peso is cheap and almost everyone I’ve spoken to agrees,” Eduardo Suarez, a Latin America strategist at Bank of Nova Scotia, said from Mexico City. “It’s mostly the Fed that’s driving it.”

Traders are now pricing in about a 40 percent chance the Fed will raise rates this year, with a 60 percent probability of a March increase. The peso will weaken 2.2 percent to 16.98 per dollar by the end of the year, according to the median forecast of analysts surveyed by Bloomberg.

The currency dropped 1 percent to 16.6252 per dollar as of 2:23 p.m. in New York on Tuesday. Banco de Mexico sold $200 million in a supplementary auction as part of its support program for the peso.

— With assistance by Ralph Cope