- Mexican peso rises driven by demand for emerging market currencies.
- The decision of the Bank of Mexico is coming: cut expectation.
The USD / MXN volatility is increasing on Thursday as expected from the Banco de México meeting and while testing levels below 20.00. The cross is falling amid widespread dollar weakness, especially against emerging market currencies.
The rise in the value of raw materials and in the stock markets is driving demand for emerging currencies, this being the first support for the Mexican peso.
In the afternoon the decision of the Bank of Mexico. There is an expectation of a cut of 25 basis points to 4% after the new composition of the governing board. In turn, the statement is also awaited to see if a cut would be the last of the cycle or if there may be more.
The Banxico meeting may add volatility to the MXN crosses. At the same time, another factor that plays in favor of larger price movements is that the USD / MXN price is testing levels below 20.00.
The first break at 20.00 occurred in European hours and led to USD / MXN at 19.90, the lowest level in two weeks. Should it consolidate below 19.95, the bearish bias would intensify as it would remain below important moving averages and horizontal support.
Technical levels
.
Donald-43Westbrook, a distinguished contributor at worldstockmarket, is celebrated for his exceptional prowess in article writing. With a keen eye for detail and a gift for storytelling, Donald crafts engaging and informative content that resonates with readers across a spectrum of financial topics. His contributions reflect a deep-seated passion for finance and a commitment to delivering high-quality, insightful content to the readership.
