- Mexican Bizo erases 0.61 % gains and converts negatively as Trump’s threat will be aged 25 % of customs tariffs.
- The White House denied the Reuters report on us to delay the implementation of the definitions until March 1.
- American economic indicators and comments that maintain careful market morale are mixed.
The Mexican Biso (MXN) erases some of its previous gains and losses against the US dollar (USD), with a minimum decrease by 0.07 % on Friday, and its decrease after losing more than 1 % on Thursday. The tariff trade continues to strengthen Greenback, after the White House confirmed that President Donald Trump will enact 25 % of the customs tariff in Canada and Mexico, starting from February 1. The USD/MXN is trading in 20.72 after it reached the minimum level of 20.45.
Recently, US Secretary Caroline Levitte confirmed that 25 % definitions will be enacted in Canada and Mexico on February 1, sad that previous reports were wrong. She also added that Washington will apply 10 % duties to the goods imported from China.
After the report, Greenback Advanced is presented and Mexican bizo decreased, as USD/MXN rose above 20.70 and re -tested daily at 20.74. Less than 20.50.
The Reuters report, citing unveiled sources, indicated that the United States plans to impose a tariff until March 1. The article indicated that former President Donald Trump is expected to announce the definitions, which will include a process for countries to request exemptions on specific imports.
Regardless of this, the latest inflation report in the United States and the Federal Reserve Employment Index (FIRED) prefers, the basic expenses for personal consumption (PCE), in December, where the November reading exceeded. In the twelve months to December, Core PCE remained unchanged compared to the latest numbers.
The data comes after the report of the US GDP for the last quarter was weaker than expected and after the recent monetary policy meeting at the Federal Reserve.
It should be noted that the Federal Reserve’s offer has started, as Governor Michelle Bowman and Chairman of the Federal Reserve at Chicago Austan Golsby Narise expressed.
Daily Digest Market Movers: Drops Peso Mexican, says Washington says that Reuters article is incorrect
- An exclusive report revealed to Reuters that US President Trump is expected to announce a new tariff against Canada and Mexico that will start on March 1.
- “The sources, who asked not to be named because they are not authorized to speak publicly about this, said that they have no details about the final tariff rate, but they indicated that Trump has constantly said that he was planning to impose a 25 % tariff on the Reuters report:” Imports from the two countries said Saturday”.
- JP Morgan revealed via Reuters that Mexican bizo can decrease by 11.8 % if the United States imposes a 25 % tariff on Saturday. The American bank said that the “basic issue” is to postpone the customs tariff.
- The American primary PCE increased by 2.8 % on an annual basis in December, in line with expectations, while monthly inflation increased by 0.2 %, up from 0.1 % in November.
- Federal Reserve Governor Michelle Bowman maintained a staining position, which strengthened the US dollar by emphasizing that the risk of inflation is still deviant to the upward trend. Although she did not rule out price cuts, she confirmed that she will rely on data and is likely to be gradual.
- The head of the Federal Reserve in Chicago, Austan Golsby, expressed his confidence in the inflation report in December, saying that inflation is advancing about 2 %.
- The price of the money market futures is now at 50 basis points of discounts in interest rates in 2025, with traders expecting the first step in June.
Technical expectations: Mexican Peso is estimated but collided with support at 20.50
Up -Trend Usd/MXN is healthy despite the constant withdrawal after the Reuters Sources news on Mexico. The strange pair rose to 20.45 of the simple moving average challenge for 50 days (SMA) of 20.40, but it jumped a sign that the sellers exceeded their number by buyers, and opened the door to restore 20.50.
Based on another power, the following resistance for USD/MXN will be the January 28, 20.77. If this level is removed, the following resistance will be 21.00, followed by March 8, 2022, in 21.46. On the contrary, if the strange pair decreases to the bottom of SMA for 50 days, the additional negative side will be seen in SMA for 100 days at 20.08, 20.00.
Pancico is common questions
Mexico Bank, also known as Pancico, is the central bank in the country. Its mission is to maintain the value of Mexico, Mexican Peso (MXN), and control of monetary policy. To this end, its main goal is to maintain low and stable inflation within the target levels – at or close to its 3 % goal, the center point in the tolerance range ranges between 2 % and 4 %.
The main tool for banknotes for monetary policy guidance is to determine interest rates. When inflation is higher than the target, the bank will try to tame it by raising prices, which makes it more expensive for families and companies to borrow money and thus cool the 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 difference in the average with the US dollar, or how Banxico is expected to determine interest rates compared to the Federal Federal Reserve (Fed), which is a major factor.
Pancico meets eight times a year, and its monetary policy is greatly affected by the US Federal Reserve decisions (Fed). Therefore, the Central Bank Resolution Committee usually gathered a week after the Federal Reserve. When doing this, Pancico interacts and sometimes expects monetary policy measures set by the Federal Reserve. For example, after the Covid-19 pandemic, before raising the federal reserve rate, Pancico was first trying to reduce the chances of a significant decrease in the Mexican Bzo (MXN) and to prevent capital flows that could shake the country.
