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The price of the Dollar falls to 17.15 against the Mexican Peso after Mexican retail sales

  • USD/MXN falls to daily lows before the opening of the American session.
  • The price of the Dollar gains traction after falling yesterday to almost three-month lows.
  • Mexico retail sales disappointed in September.

The USD/MXN saw strong swings yesterday, Tuesday, as it initially fell to two-month lows at 17.06 and then rose strongly to six-day highs at 17.26. Today, November 22, the price of the Dollar rose to a daily ceiling of 17.25 and after the news of Mexican retail sales fell to the day’s lows at 17.15.

The price of the Dollar gains traction after yesterday’s sharp fall

The Dollar Index (DXY) fell on Tuesday, November 21 to 103.17, its lowest level in almost three months, specifically since August 31. Today, Wednesday, the greenback has regained ground, rising at the European open to two-day highs of 103.91. Although the movement has not continued and the Dollar has retreated in recent hours, the price manages to remain around 103.60/70, far from yesterday’s lows.

Mexico retail sales disappoint in September

The Mexico’s retail sales grew 2.3% year-on-year in September compared to the 3.2% increase in August. This is the lowest percentage of growth recorded by the indicator since February 2021. The figure disappoints market expectations, since an increase of 3.6% was expected. On a monthly basis, the indicator fell 0.2%, moderating the 0.4% decline seen the previous month. The data worsens the forecasts of experts, who predicted an increase of 0.3%.

Traders are now awaiting US data to be released before Thursday, November 23, Thanksgiving Day. Durable goods claims for October, weekly jobless claims for the week of November 17, and the University of Michigan Consumer Sentiment Index for November could generate high volatility in the pair.

Tomorrow the focus will be on the Mexican inflation figures for the first half of November, which are expected to rise 0.6% monthly in the general reading and 0.22% in the underlying reading. A larger increase than the estimate, together with the disappointment in retail sales today, could cast doubt on Banxico’s next interest rate decision, despite the fact that the central bank has long insisted that it will leave interest rates at its current level of 11.25% for some time.

USD/MXN Price Levels

The US Dollar is trading against the Mexican Peso at 17.17, losing 0.08% daily. A downward movement will find support at 17.06, a new two-month low reached yesterday, followed by the 17.00/16.99 area, where the psychological level and the low of September 20 are. Below, it expects 16.70, the bottom of August 31.

To the upside, yesterday’s high at 17.26 would be the first barrier to the upside. Next, the USD/MXN would find a barrier around the 17.40 level, the high of November 15. Further up, last week’s high around 17.70/17.72 will be a difficult hurdle to overcome.

Source: Fx Street

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