- Mexican peso regains ground after days with losses against the dollar.
- USD / MXN falls back towards the 20-day moving average.
The USD / MXN is falling on Monday, after having risen in the previous three days. The price peaked in the Asian session at 20.11 and then fell to 19.99. It is trading at 20.05, with sideways rallies in the very short term.
The weakness of the dollar together with the rise in the stock markets has been the main factor behind the fall of the USD / MXN. Most emerging currencies are showing moderate gains.
This week, which is the last full week of 2020, has several key events ahead, with several central bank meetings. Among these will also be the Bank of Mexico. It is not expected that there will be a change in interest rates by Banxico, but the tone of the statement will be key to see if the recent drop in inflation and the support of the Mexican peso, again open the doors to more cuts to boost the economy.
From a technical point of view, the dominant trend remains bearish in USD / MXN. In the shorter term, the dollar eased downward pressures with a return to the 20-day moving average. A rise above 20.20 would enable more gains for the dollar. While in the opposite direction, at 19.90 is the key short-term support, which if it were to yield would expose the recent lows in the 19.70 area.
Technical levels
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