- Dollar maintains Tuesday’s gains against most emerging currencies.
- USD / MXN retreats but some upward pressure still remains.
USD / MXN is falling on Wednesday after rising to 20.07 on Tuesday, matching last week’s highs. The pullback found support at 19.90 and is trading around 19.95, after failing to recover 20.00.
The intraday tone remains bearish, but the USD / MXN has not yet managed to remove the upward pressures on Tuesday. The rise of the dollar throughout the market was one of the key factors.
Risk aversion weakened emerging market currencies. These were favored only by a drop in Treasury bond yields. The 10-year rate on the benchmark 10-year US bond fell to a month-low below 1.35%.
Another downward drag factor was the decline in the price of oil. WTI’s barrel changed direction after hitting highs since 2014. It is trading at $ 73.30, close to Tuesday’s low.
The key for the next few hours is what happens on Wall Street and with the minutes of the last Federal Reserve meeting, to be published in the second half of the American session. Thursday will be the turn of the Banxico minutes and inflation data from Mexico.
Technical levels
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