- Mexican peso tries to regain strength after sharp declines.
- US wholesale inflation for August without surprises.
- USD/MXN stable around 20.00.
USD/MXN is declining modestly on Wednesday, after making a big gain on Tuesday. ANDThe pair reached hours back as low as 20.10, the highest in almost a week, and then fell back to 19.96. For hours it has been operating around 20.00.
In a few hours, the USD/MXN went from lows in months to jump to 20.10before a strong dollar rally throughout the market. The US inflation data for August came in above expectations and sparked speculation of a 100 basis point hike by the Federal Reserve next week.
US wholesale inflation data for August was published on Wednesday. This time there were no surprises on the upside. The producer price index registered a decrease of 0.1%, as expected. The annual rate fell to a one-year low of 8.7%.
This time, the inflation figures did not generate much movement. Both the dollar and the shares remain with limited tours. The greenback looks less strong, which favors the decline of the USD/MXN.
In a general perspective, the pair maintains a slightly bearish bias, which would change on a break above 20.20. In the opposite direction, immediate support is again at 19.90. Below emerges the 19.80 area, where a close below would expose June’s bottom at 19.50.
Technical levels
Source: Fx Street
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