Mexican Peso is fixed as USD/MXN reacts to the risks of the United States Mexico, Federal Reserve, Pancico
- Mexican bizo holds a constant despite the high political tension between Mexico and the United States.
- You see Federal Reserve and Mexico to guide politics.
- USD/MXN exchange rate tests.
The Mexican Biso (MXN) remains flexible against the US dollar (the US dollar) at the European session on Monday, despite the high tensions during the weekend between Mexican President Claudia Shinbom and US President Donald Trump regarding a rejection proposal to deploy American forces in Mexico.
New signs appeared on the slowdown in the American economy on Monday, when the global purchasing directors of the United States of America (PMI) came at 50.6 for April, a decrease from 53.5 in March and the bottom of both flash estimates (51.2) and the market compatibility (51.4). Reading, which embodies the activity in both the manufacturing and services sectors, enhances fears that the American economy cools more quickly than expected.
With the circulation of USD/MXN exchange rates at 19.617, 0.17 % higher than the closure of Friday at the time of writing this report, the markets remain focused on the next American economic dataFederal Reserve Prices, and the broader risk environment for the next potential catalyst that can push the emerging currency pair (EM) from its last scope.
During the weekend, Reuters reported that Mexican President Claudia Shinbom had rejected an offer from US President Donald Trump to allow us to enter Mexico to combat drug trafficking. Speaking at a general event in Texcoco, Sheinbau reiterated Mexico’s position on sovereignty, saying: “We can work together, but you are in your lands and we have in us.” On Sunday, Trump confirmed the proposal, and the Kartel’s violence described a major threat and indicates drug gangs as “terrible people”.
Mexican Biso is fixed as political geography and central bank signals form the US dollar/MXN
While the stock exchange highlights long -term sensitivities between the two countries, PESO’s silent response indicates that investors are priority to economic basics, especially monetary policy, on political noise.
Mexican bizo is still very sensitive to the transformations of global risk and developments in the United States, which represents about 80 % of Mexico exports. As such, the direction of the USD/MXN pair is formed primarily by divergence of interest rates between the American Federal Reserve (FED) and the bank of Mexico, along with the broader macroeconomic signals.
This week, the market’s interest is determined firmly on the interest rate decision in the upcoming Federal Reserve, scheduled for Wednesday, May 7. While it is widely expected that the Federal Open Market Committee (FOMC) will retain 4.25 %, the main focus of investors is the correspondence that accompanies the decision. Specifically, the tone of the Federal Reserve Council will be Jerome Jerome Powell. After compensation for work, it will be extremely important in forming expectations about the interest rate of interest in the United States in the second half of the year.
For a USD/MXN pair, any indication that the Federal Reserve may begin to reduce policy sooner than expected can transform capital flows, reduce the return of the US dollar’s return feature, and provide renewed support to Mexican Peso. On the contrary, the most cautious or data -based position may enhance the current conditions associated with the group, making the pair sensitive to additional transformations in economic data and communications in the Central Bank.
Daily Digest Movers: Interest rates and economic expectations are still necessary for the US dollar
- According to the CME Fedwatch tool, markets are priced at 25-Basis rates in July, as signs of increasing US growth. Powell this week can affect the US dollar and support EM currencies such as Mexican Bezo.
- Despite the unexpected salary report on Friday (NFP) on Friday, which showed a strong creation in job opportunities, stable unemployment, and average clock profit, the US dollar’s failure to get traction, highlighting the market warning about the timing of future prices.
- Pancico is scheduled to meet on May 15th, following two consecutive discounts of the 50 Basis rate, which raised the interest rate to 9.00 %. As inflation and growth reduces, the markets expect another reduction, although Pancico has indicated a cautious approach to data.
- The Mexican economy grew 0.2 % of Qoq in the first quarter of 2025, and the narrow avoids technical stagnation. The gains were concentrated in agriculture and mining, while contracting manufacturing and services are stagnant.
- The re -introduction of American definitions on the main Mexican exports, including vehicles and minerals, has added pressure on the external sector of Mexico and may affect foreign growth and investment in the coming months.
Universal uncertainty, including slowing international demand, volatile basic commodity prices, and potential transformations in American trade or immigration policy, constitute additional risks to the confidence of the bizo and the constant in emerging markets.
Peso is fixed like USD/MXN kiosks below the descending trend line
Technically, the USD/MXN remains in the range of tight unification with a little less than a 10 -day moving average (SMA) at 19,5864, where the couple struggles to free from a well -defined convergence channel.
Fibonacci alternative is extracted from the highest level in April from 21.0826 to the lowest level in April from 19.451, which puts a clear structure of possible or continuing reflection. The couple is currently testing the owner of the 100.0 % Vibonacci deputy in 19.4701, which was a strong support in the last sessions.
A sustainable break below this region can offer a 61.8 % Fibonacci tradition level in a 2024 – 2025 movement at 19.3721, which opens the negative side.
On the upper side, the resistance is first seen in SMA for 10 days, then at 19.6910, with the strongest resistance alignment near 19.8152 (78.6 % of PDF). The April Peak’s descending trend line continues to recover attempts.
Meanwhile, the RSI indicator remains defeated less than 40, indicating that the declining momentum is still in place. Despite the hammer candlestick He appeared on April 24, and he has not yet ever any significant bullish follow -up, which makes prejudice in the short term tend to be cautious unless the husband is broken over the resistance of the direction line.
USD/MXN Daily Chart
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.
