- The Mexican peso is rising across the board on Friday.
- USD / MXN is heading to the lowest daily close in a month.
The USD/MXN it falls on Friday for the third day in a row and trades at 20.56, the lowest level in a month. The Mexican peso remains supported by an improvement in global risk sentiment. Also, a weaker dollar contributes to the pair’s decline.
The decline continues after the data
Data released on Thursday showed that inflation in Mexico was lower than expected during the first half of December, but underlying figures beat forecasts and, even so, the main reading is above 7%, far from Banxico’s target. . The figures justify more rate hikes in Mexico.
In the US, Thursday’s economic figures also show high inflation, reinforcing expectations for some action by the Federal Reserve next year. The dollar failed to rise thanks to economic indicators, affected by the rise in share prices.
Optimism around financial markets continues to help emerging market currencies like the Mexican peso. If the situation persists, the USD / MXN is likely to continue falling.
The pair is approaching the 20.45 / 50 area, a strong support and also around the 100-day simple moving average. The mentioned zone should limit the downside and favor a rebound, probably to the 20.70 zone. A break below 20.45 would expose the November low at 20.23. On the upside, the immediate resistance zone is now 20.65 / 70 followed by 20.90.
Technical levels
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