USD/MXN is approaching the end of the week with a consistent bullish bias, as price action has gained more than 1.00% during today's session, moving against the Mexican peso and in favor of the U.S. dollar in the short term. This upward pressure has followed the Bank of Mexico's decision to continue along a path of lower interest rates, which has reduced the peso's attractiveness in the short term.
Over the last two trading sessions, USDMXN has shown limited movement, with an average variation of around 0.3%, as the market awaits the U.S. central bank decision. Although the Bank of Mexico is set to announce its decision next week, there have been no meaningful updates supporting a sustained strengthening of the Mexican peso.
The US dollar continues to drive where we go in multiple markets. On Monday, it looks like risk appetite is a bit stronger.
USD/MXN is bouncing on risk-off flows, but 18.00 remains the key resistance level where sellers may look to reenter the broader downtrend.
The week begins with a new depreciation in USD/MXN of -0.71% during the session, favoring the Mexican peso and attempting to reestablish a consistent bearish bias.
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USD/MXN trips down towards 17.56 as risk appetite boosts Mexican Peso
Watching the interest rate markets and various risk sensitive currencies will be the way I approach the markets today.