- The Mexican peso remains firm against the dollar, despite the strength of the DXY.
- The coin is among the best performers in the world in the last seven days.
- USD/MXN with a bearish bias, testing the support at 19.75.
USD/MXN is falling for the fifth day in a row on Wednesday and is testing the 19.75 zone. It bottomed out at 19.73, the lowest in a week, and then rebounded after US inflation data rose to 19.78.
firm downtrend
USD/MXN remains firmly on the downside, but is facing important support around 19.70/75, a level that if broken could enable a drop towards 19.50. For now, the level returns to offer containment. On the upside, resistance is seen in the round numbers that the pair has respected: 19.90, 20.00 and 20.10.
The negative moment of the USD/MXN has a correlate in the Mexican peso, which is among the best performing currencies of the last seven days in the world. It is not affected by the caution, nor the proposals to reform the electricity sector in Mexico. The rise in the price of commodities once again boosts emerging markets, favoring the MXN.
The dollar, despite falling against the MXN, remains firm in the market, supported by the rise in Treasury bond yields. The DXY registers the ninth daily profit in a row. This index mainly reflects the advance of the dollar against the currencies of the G10.
In the US, another high inflation data was released on Wednesday, which will serve to anchor expectations of a more aggressive monetary tightening policy by the Federal Reserve. The producer price index had an increase of 11.2% (yearly) in March, higher than the 10.6% expected. This adds to Tuesday’s retail inflation rate which was also higher than the market consensus.
Technical levels
Source: Fx Street
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.
