Forex: USD/MXN in session highs after BoM decision (Barcelona) - The Mexican peso is losing ground against its northern neighbor on Friday, after the Mexican central bank – Banco de México – left the refi rate unchanged at 4.5%, in line with expectations.

The central bank justified its decision in the economic weakness overseas, and the prospect of a sluggish US economic growth for the present year. The domestic economic activity continues to growth at a moderate pace, although exports are showing some signs of deceleration. In the same tone, the Mexican labor market is prolonging its recovery and the bank sees no signs of inflation pressures in the near term.

At the moment, the cross is up 0.62% at 12.6635 with the next resistance at 12.6980 (high Jan.15) ahead of 13.0600 (high Dec.24) and then 13.1050 (high Oct.29).
On the downside, a breach of 12.5550 (low Jan.17) would open the door to 12.5500 (low Mar. 2012) and 12.4850 (MA21d).