USD/MXN inches higher to near 16.80, following US data and Banxico's policy rate cut
|- USD/MXN extend its winning streak for the third successive session on Friday.
- S&P Global Manufacturing PMI rose to 52.5 against the expected 51.7 and 52.2 prior.
- Banxico has lowered its interest rates by 25 bps to 11.0% in its March policy meeting.
USD/MXN rises on stronger US Dollar (USD) following mixed S&P preliminary Purchasing Managers Index (PMI) data and robust weekly Jobless Claims from the United States (US). The pair trades higher around 16.80 during the European session on Friday.
Additionally, the Bank of Mexico (Banxico) has reduced its interest rates by 25 basis points (bps) to 11.0% in a March policy meeting held on Thursday. This has contributed to the downward pressure on the Mexican Peso (MXN), consequently, underpinning the USD/MXN pair.
Additionally, the Bank of Mexico is set to release the 1st half-month Core Inflation for March, with expectations of a 0.26% increase, compared to the previous increase of 0.24%. The 1st half-month Inflation is anticipated to show a rise of 0.28%, a turnaround from the previous decline of 0.1%.
In March, the S&P Global Services PMI showed a slight decline, dropping to 51.7 from 52.3, slightly below the expected reading of 52.0. On the other hand, the Manufacturing PMI increased to 52.5, surpassing expectations of 51.7 and the previous figure of 52.2. Initial Jobless Claims for the week ending on March 15 came in at 210K, below the 215K expected and 212K prior.
The US Dollar Index (DXY) has continued to strengthen despite lower US Treasury yields. However, the US Dollar encountered challenges following the Federal Reserve's (Fed) reaffirmation of expectations for three interest rate cuts in 2024. The prevailing consensus indicates the commencement of an easing cycle in June, with the timing of subsequent cuts dependent on incoming data.
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers.