Mexican Peso Outlook: USD/MXN Wanders Aimlessly as Key Resistance Comes in Focus

mexican peso outlook usd mxn wanders aimlessly as key resistance comes in focus

Sumary of Mexican Peso Outlook: USD/MXN Wanders Aimlessly as Key Resistance Comes in Focus:

  • Silver Outlook Moderately BearishUSD/MXN trades with a neutral bias on Thursday, oscillating between small gains and losses around the 20.15 mark in the absence of relevant catalysts.
  • Although risk appetite appears to be picking up to some extent, as reflected by large gains in US equities on Tuesday and Wednesday, the market environment remains fragile and cautious amid rising Delta variant infection rates.
  • With the delta strain spreading rapidly around the world, EM FX may remain on a defensive footing or trade directionless for a while, as fears of a slowing global economic recovery boost the appeal of safer currencies such as the US dollar, Japanese yen or Swiss franc.
  • The aforementioned scenario leaves the Mexican peso in a good position over the medium term, even more so now that Banxico looks set to raise rates again in the second half of the year to contain inflationary pressures (high inflation was confirmed again today by higher-than-expected biweekly core and headline CPI readings).

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