The Mexican Bizo ends the week strongly with the dollar decrease in the Chinese default
- Mexican Peso gains with China’s retaliation for 125 % definitions, sending the US dollar index to less than 100 for the first time since 2021.
- Pancico report shows unanimous concern about mutual growth; Most likely reduce the next meeting.
- Mixed American data: The product price index cools but is still high; Feeling declines and jumping inflation expectations.
The Mexican Bizo ends up with a higher note with the weakening of Greenback in all fields. The Chinese -American trade war escalated, with China’s revenge on US President Trump’s recent announcement. USD/MXN is traded in 20.27, a decrease of 0.72 %.
The financial market novel remains about the definitions. China’s answer to the United States was 145 % known early in the North American session, with Beijing with 125 % duties on American products. After the title, Pak decreased sharply, and the US dollar index (DXY), which tracks its performance against a basket of six other currencies. DXY has reached the lowest level for more than 30 months at 99.01. As of writing, DXY is in 99.87, a decrease of more than 1 %.
Mexican industrial production improved in February, and unveiled the NACIONAL De EstadíStica Geographía E Informática (INEGI). Meanwhile, the last minutes of the Panco de Mexico (Pancico) meetings revealed that all of its members said that the economy was slowing and developing the inflation process.
Regarding the definitions, Mexican products are still outside the USMCA trade agreement subject to 25 %, although it stopped for 90 days on other countries, revealed a White House official.
Data from the United States (United States) revealed that the PPI price index has decreased compared to February data. The basic product price index is also cooled, but remained higher than the 3 % threshold.
Other data showed that the consumer morale has deteriorated sharply and inflation expected increased.
Despite the decline in the US dollar/MXN, the upward trend is more upward. Pancico is expected to reduce prices at the next meeting. On the other hand, the Federal Reserve is likely to retain rates unchanged at the May meeting, as investors witnessed the first reduction in July.
Daily Digest Market Movers: Peso Mexican is not annoyed by the high returns of the United States, and risk alienation
Inegi revealed that the industrial production of Mexico in February increased by 2.5 % of the mother, increasing the -0.6 % contraction in January. In the twelve months to February, production improved from a contraction of -2.9 % to -1.3 % on an annual basis.
Pancico Governor Victoria Rodriguez Siga appeared in front of the Senate. She said that the Council of Government is still not satisfied with the inflation rate, which reached 3.8 % on an annual basis in March, although it is far from the target of 3 %. She added that the process of inflation and economic slowdown is justifying the Bancico’s membranous approach, and hinted that the central bank may continue to reduce a policy.
The American consumer feelings decreased sharply in April, as the University of Michigan fell from 57.0 to 50.8. The inflation forecast jumped, as the expectations increased for a year from 5 % to 6.7 % and 5 years from 4.1 % to 4.4 %.
The product price index in March has decreased to 2.7 % on an annual basis, less than expectations 3.3 % and a decrease than 3.2 %, indicating more soft entry costs.
CORE PPI held a 3.3 % company on an annual basis, a decrease of 3.5 %, but is still higher than the 3 % threshold.
Technical expectations in US dollars/MXN: Mexican Peso is estimated where USD/MXN is under 20.50
The USD/MXN is playing, although the sellers intervened, as they withdrew the immediate price without No. 20.50. Near the end of the session, Bears led the exchange rate to without meeting simple moving averages for 50 days and 100 days (SMAS) near 20.33/36, which, if exceeded, cleansing the floor to test 20.00.
On the contrary, if the US dollar/MXN rises to the daily peak on April 9, 21.07, the husband may be ready to challenge the highest level from year to date (YTD) 21.28.
Common questions between Mexican Peso
The Mexican Bezo (MXN) is the most circulating currency among its peers in Latin America. Its value is widely determined by the performance of the Mexican economy, the country’s central bank policy, the amount of foreign investment in the country and even the levels of transfers sent by Mexicans who live abroad, especially in the United States. Geopolitical trends can also move MXN: for example, the proximity process – or the decision of some companies to transfer manufacturing capabilities and supply supply chains near their countries of origin – is a motivation for the Mexican currency as the country is a main manufacturing center in the American continent. Another MXN catalyst is oil prices because Mexico is a major source of commodity.
The main goal of the central bank in Mexico, also known as Pancico, is to maintain inflation at low and stable levels (in or near its 3 % target, the center point in the range of tolerance between 2 % and 4 %). To this end, the bank determines an appropriate level of interest rates. When inflation is very high, BancicPico will try to tame it by raising interest rates, making it more expensive for families and companies to borrow money, thus cooling demand and macroeconomic economy. The highest interest rates are generally positive for Mexican Peso (MXN) because it leads to higher returns, making the country a more attractive place for investors. On the contrary, low interest rates tend to weaken MXN.
The total economy data is a key to assessing the state of the economy and can have an impact on the Mexican PESO (MXN) evaluation. The strong Mexican economy, based on high economic growth, is a decrease in unemployment and high confidence, useful for MXN. It not only attracts more foreign investments, but may also encourage the Bank of Mexico to increase interest rates, especially if this force corresponds to high inflation. However, if economic data is weak, MXN is likely to decrease.
As a currency of the emerging market, the Mexican Biso (MXN) tends to strive during risk periods, or when investors see the wider market risk low and thus yearn to communicate with investments that bear greater risks. On the contrary, MXN tends to be weak in times of turmoil in the market or economic uncertainty where investors tend to sell high -risk assets and flee to the most resigned safe havens.
