USD/MXN to trade around 17.20 in early 2024 before heading up to the 17.80 region – Rabobank
|A significant move lower in USD/MXN did come to fruition in November. Economists at Rabobank analyze the pair’s outlook.
USD/MXN will remain at the mercy of interest rate differentials
USD/MXN will remain at the mercy of interest rate differentials, and we expect to see some reversal of the March Fed rate cut currently implied by the USD front-end. This should provide some support for USD and push USD/MXN higher.
That said, we remain bullish MXN on the crosses. While some upside is likely to occur, our base case is for USD/MXN to average around 17.20 over the next month, and we expect the pair to trade around there in early 2024 before heading up to the 17.80 region heading into the end of the first quarter.
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