- The dollar falls against emerging market currencies at the start of the week.
- USD/MXN pulls away from recent peak, tests 18.80.
The USD/MXN is falling for the second day in a row and continues to decline after the strong rebound of previous days. The pair operates around 18.80, supported by the weakness of the dollar, the rebound in commodities and the rise in Wall Street.
Last week the USD/MXN rose after making an upward correction from its lowest in years. It went from 18.56 to rise to 19.09. The price could not be affirmed above 19.00 and is currently moving with a bearish bias, in line with the dominant trend.
The decline is being guided by the weakness of the dollar in the market, given the expectation of a Federal Reserve smoother (it would rise by only 25 basis points in February) and the rise in the stock markets. There will be no presentations from Fed officials this week, as they are in the quiet period ahead of the January 31-February 1 meeting. Important data will be released this week in the US including the underlying personal consumption spending index.
In Mexico key information will also come out with the inflation figures for the mid-January month on Tuesday, with the expectation of a drop from 7.83% to 7.75%; and that the underlying one rises marginally. Banxico’s next meeting will be on February 9, which would include a new interest rate hike.
technical levels
Source: Fx Street
I am Joshua Winder, a senior-level journalist and editor at World Stock Market. I specialize in covering news related to the stock market and economic trends. With more than 8 years of experience in this field, I have become an expert in financial reporting.
