USD / MXN remains in recent range near 20.50 after Banxico decision

  • USD / MXN stabilizes in the 20.50 zone.
  • Mexican peso cuts weekly gains after failing with 20.00.

The USD / MXN remains operating in the range of the last hours between 20.65 and 20.45, without significant changes after the decision of the Bank of Mexico. On Friday the markets remain with limited changes favoring the consolidation of the cross.

The dollar hit the highest level in a week against the Mexican peso on Friday, rising to 20.69, but quickly returned to the previous range.. The greenback is slightly lost ground on Friday throughout the market, favoring the decline of the USD / MXN.

In any case, the important thing these days in the USD / MXN was the non-break of 20.00. The rally of the Mexican peso met there with a strong barrier that could not break and then the dollar rebound.

The weekly chart shows the cross heading to the lowest close since March, but far from the lows., which is a negative sign for the peso and points to a recovery in the dollar or a consolidation ahead.

Part of what happens will depend on what happens in the stock markets on Wall Street, which continues to be a key factor for the movements of the Mexican peso and the rest of the emerging currencies.

Banxico maintains the rate and surprises half

The Mexican central bank on Thursday decided to keep the benchmark interest rate unchanged at 4.25%. LExpectation was divided between a cut and no changes. Four members voted in favor and one asked for a cut. In the statement, Banxico stated that the pause helps inflation to have a convergent path towards the objective.

Market analysts interpreted that it would be a pause and not the end of the cycle of low interest rates. What happens in the next meetings will depend on what happens with the Mexican peso, inflation and activity in general.

You may also like