The price of the Dollar falls sharply against the Mexican Peso after the improvement in GDP and requests for durable goods from the US.

• USD/MXN has fallen to daily lows of 18.25.
• The price of the Dollar rebounds strongly after the US data.
• The US economy grew at a faster pace than expected in the preliminary reading for the third quarter.

The USD/MXN reached its highest price in six days at 18.42 in the European session, but lost all the ground gained after the good US GDP data and durable goods orders. The pair fell to 18.25, a new low for the day, and is now trading above 18.30, losing 0.13% daily.

The price of the Dollar oscillates after the US data

He Dollar Index (DXY) reacted to the good US figures with an initial rise to 106.88, the day’s high previously tested at the European opening, to immediately fall thirty pips. The Dollar has regained traction in the last hour, trading around 106.79, gaining 0.23% so far this Thursday.

The Gross Domestic Product (GDP) of the United States grew 4.9% in the preliminary reading for the third quarter of 2023. The figure exceeded the 2.1% of the second quarter of the year and improved market expectations, which forecast an increase of 4.2%. Durable goods orders grew 4.7% in September, improving on August’s -0.1% (revised downward from +0.2%) and the 1.5% increase expected by consensus.

The weekly jobless claims numbers were not as positive, rising to 210,000 in the week of October 20 from the previous 200,000 (revised upward from 198,000), worse than the 208,000 estimate.

Mexico published its unemployment rate for September, showing a reduction of one tenth to 2.9% in September, as expected.

While waiting to digest the data, operators will focus tomorrow, Friday, on the personal consumption PCE data for September from the United States and on the consumer sentiment index from the University of Michigan, which will also reveal their inflation expectations at 5 years. Mexico will release the trade balance for September, which is expected to reduce to -0.712B dollars from -1.377B in August.

USD/MXN Price Levels

A downward break of the daily low in 18.25 It will point towards the support 18.07, the weekly minimum recorded on October 23, followed by the psychological zone of 18.00. A break below this region could cause a decline towards 17.75, the weekly low of October 12.

To the upside, the zone between 18.46/18.49 stands as the main resistance, as it contains the October highs recorded on October 20 and 6, respectively. Higher up I would expect the barrier located at the psychological level of 19.00.