- Mexican peso set the weekly profit for 0.89% because economic resistance will surprise markets.
- Trump’s mixed tariff comments evoke volatility, but market appetite is market currencies.
- Traders will undergo Mexico Q1 HDP next week to reveal the risks of recession.
Mexican Peso has prolonged its profits compared to the US dollar the second consecutive day, ready to complete the week of profits of 0.89%, sponsored by improvement in Risk And better than the expected economic data of Mexico. At the time of writing, USD/MXN is traded at 19.52, by 0.32%.
Wall Street closed profits for Friday’s meeting, although US President Donald Trump has given contradictory notes about China. The news overnight for US traders revealed the willingness of Beijing to limit tariffs to American products. Despite this, Trump said he would not reduce tariffs if he “gives us something essential”.
Instituto National de Estadista Geographia E Informatica (Inegi) revealed that the Mexican economy grew in February, unlike forecasts that expected slight expansion.
Meanwhile, in the US in the April index of the University of Michigan consumer consumers (UOM), he has worsened and published his fourth lowest reading since the late 1970s, suggesting that Americans have doubted the economy view.
Therefore, USD/MXN moved lower, driven data of good mexicas. However, Inegi will release next week Gross domestic product (GDP) Growth rate in the first quarter of 2025. Negative reading would confirm that the economy is in the technical recession.
Daily Digest Market Movers: Mexican Peso appreciated during the week despite Banxyo’s attitude
- The divergence between Banxiko and the Fed prefers USD/MXN. The Banxico Administration Council has expressed its decision to continue to relieve policy. On the contrary, the Fed is considered cautious, because some officials have shown concerns about the reacceleration of inflation stimulated tariffs.
- Mexican economic activity in February has expanded by 1% MOM, above prognosis for growth of 0.6%. Annually, the activity was immersed from 0% to -0.7%, which was better than expected.
- Economic data revealed during the week in the first half of April witnessed Reacceleration on inflation, revealed Inegi. Retail sales in February were lower than expected, which is a continuing economic slowdown.
- Representative of Governor Banuxico Omar Mejia Castelazo revealed that the economy has been undergoing slowing since 4 2023, he said in Washington.
- A survey of Citi Mexico’s expectations shows that economists expect Banxico to reduce its rate by 50 basis points at the May meeting. The whole year projects the main reference rate and ends almost 7.75%.
- Regarding the USD/MXN exchange rate, privacy analysts sees an exotic pair that ended at 20.93, compared to 20.90. Inflation is expected to end at 3.78% in 2025, with basic numbers to 3.80% are mostly in line with the previous vote.
- The Mexican economy is expected to increase by 0.2% in 2025, below 0.3% projected in the previous survey.
USD/MXN technical outlook: Mexican peso remains bull because USD/MXN remains below the key technical level
The price event suggests that USD/MXN is distorted to the bear and can continue in its descending order as soon as it registers a daily near 19.50. In this result, further support would be low 23 from 19.46, which is the current low year -on -year (YTD) low, followed by a psychological figure of 19.00.
If the buyers want to push higher prices, the 200 -day SMA must be back at 19.93, followed by number 20.00. The latter violation reveals a high height of 14 April and a 50-day SMA near 20,25-20,29 before testing a 100-day SMA at 20,33.
Mexican Questions Peso
Mexican peso (MXN) is the most traded currency from its Latin American peers. Its value is generally determined by the performance of the Mexican economy, the policy of the country’s central bank, the amount of foreign investment in the country and even the level of remittings sent by Mexicans who live abroad, especially in the United States. Geopolitical trends can also move MXN: for example, the process of a nearby process – or the decision of some companies to move production capacity and supply chains closer to their home countries – is also considered a mexican currency catalyst because the country is considered a key production center on the US continent. Oil prices are another catalyst for MXN because Mexico is a key exporter of the commodity.
The main objective of the central bank of Mexico, also known as Banxiko, is to maintain inflation at low and stable levels (at or near or near the target 3%, center in the tolerance zone between 2%and 4%). For this purpose, the Bank lays down the appropriate interest rate. When inflation is too high, Bancoco will try to tame it by increasing interest rates, which empowers more expensive to borrow money for households and businesses, and thus cooling and the overall economy. Higher interest rates are generally positive for Mexican peso (MXN) because they lead to higher yields, which makes the country a more attractive place for investors. On the other hand, lower interest rates tend to weaken MXN.
The issue of macroeconomic data is crucial to the state of the economy and may have an impact on the Mexican Peso (MXN) award. A strong Mexican economy based on high economic growth, low unemployment and high trust is good for MXN. Not only does it attract more foreign investments, but it can encourage the Bank of Mexico (Banxico) to increase interest rates, especially if this power is associated with increased inflation. However, if economic data are weak, it is likely that MXN will depreciate.
Like the currency of the developing market, the Mexican peso (MXN) tends to strive to take it during the period of risk, or when investors perceive that the wider market risks are low and therefore desire to engage in investments that carry a higher risk. On the other hand, MXN tends to weaken at the time of market turbulence or economic uncertainty, because investors tend to sell assets with higher risk and flee to more stable safe paradises.
