|

Mexico headline inflation rose by less than anticipated, MXN to retain the soft tone

Mexico reported that 12-month inflation rose by 3.94% in May, down from 4.45% previously and the 4.03% expected by market participants. The index, released by the Bank of Mexico (Banxico), reinforced expectations that the central bank will maintain its interest rate at current levels for an extended period.

On a monthly basis, headline inflation was up 0.21%, while the core monthly reading came in at 0.22%, both below market expectations.

US Dollar Price Today

The table below shows the percentage change of US Dollar (USD) against listed major currencies today. US Dollar was the strongest against the Japanese Yen.

USDEURGBPJPYCADAUDNZDCHF
USD-0.32%-0.46%-0.02%-0.23%-0.22%-0.56%-0.30%
EUR0.32%-0.12%0.32%0.08%0.13%-0.21%0.04%
GBP0.46%0.12%0.45%0.23%0.23%-0.08%0.17%
JPY0.02%-0.32%-0.45%-0.22%-0.21%-0.55%-0.29%
CAD0.23%-0.08%-0.23%0.22%0.01%-0.31%-0.06%
AUD0.22%-0.13%-0.23%0.21%-0.01%-0.32%-0.10%
NZD0.56%0.21%0.08%0.55%0.31%0.32%0.25%
CHF0.30%-0.04%-0.17%0.29%0.06%0.10%-0.25%

The heat map shows percentage changes of major currencies against each other. The base currency is picked from the left column, while the quote currency is picked from the top row. For example, if you pick the US Dollar from the left column and move along the horizontal line to the Japanese Yen, the percentage change displayed in the box will represent USD (base)/JPY (quote).

What does Mexican inflation mean to the Mexican Peso?

The Mexican Peso barely reacted to the news. As previously noted, the lower-than-anticipated figures reinforce the case for no near-term change in interest rates. Banxico trimmed the overnight interbank target rate by 25 basis points (bps) to 6.50% when it met in May. The next monetary policy meeting will take place on June 25.

USD/MXN Technical Outlook

Chart Analysis USD/MXN

In the four-hour chart, USD/MXN trades at 17.38 and holds a mild bullish bias as it hovers just under the 20-period simple moving average (SMA) at 17.381 while staying above the 100- and 200-period SMAs around 17.34, suggesting downside attempts are being absorbed above the broader trend floor. Short-term momentum remains constructive with the 14-period Momentum indicator in positive territory and the Relative Strength Index (RSI) hovering near the neutral 50 line, hinting at a consolidative advance rather than an overstretched move.

On the topside, immediate resistance is defined by the 20-period SMA at 17.38. A sustained break higher would open the way for further gains toward the next psychological hurdles beyond the recent highs. On the downside, initial support is seen at the nearby intraday pivot around the day’s open at 17.4482, turning lower toward the current price zone, ahead of a more important demand band at the 200-period SMA near 17.3401, reinforced by the 100-period SMA at 17.3391, where buyers are likely to re-emerge if the cross retreats.

(The technical analysis of this story was written with the help of an AI tool.)

Author

FXStreet Team

Composed of a group of economic journalists and FX experts, the FXStreet content team produces and oversees all content published on FXStreet. It provides a purely journalistic approach to the Forex market.

More from FXStreet Team
Share:

Editor's Picks

AUD/USD picks up amid easing geopolitical tensions, bright data from China

The Australian Dollar posts moderate gains against the US Dollar on Tuesday, regaining some of the ground lost last week, although it remains at its lowest level in nearly two months. News that Israel and Iran halted hostilities has triggered a mild relief rally. At the same time, upbeat Chinese trade data has provided additional support for the Aussie, as China is Australia’s major trading partner.

Japanese Yen steadies near recent lows as ceasefire, Japan intervention threats offset

USD/JPY trades around 160.15 on Tuesday, remaining close to its highest level since April 30 despite a broadly neutral intraday performance. The pair retains an underlying bullish bias, supported by expectations that US monetary policy will remain restrictive, although upside potential is being capped by the risk of intervention from Japanese authorities.

Gold stays slightly bid near $4,340

Gold remains stuck in a narrow range on Tuesday, still trading below the $4,400 mark per troy ounce. The precious metal’s marginal advance comes on the back of easing geopolitical tensions and a deeper retracement in the US Dollar, although the likelihood of a cautious Fed down the road should keep the metal under scrutiny.

Crypto Today: Bitcoin, Ethereum, XRP edge lower despite Middle East tensions easing

Cryptocurrency prices trade amid persistent selling pressure on Tuesday. Bitcoin (BTC) hovers near $63,000, Ethereum (ETH) above $1,650, and Ripple (XRP) around $1.14.

Hotter US inflation numbers could further bolster Fed hike bets

Middle East tensions keep inflation risks elevated. Fed hike fully priced in by year end amid strong NFP report. US CPI data on Wednesday (12:30 GMT) to enter the spotlight. Further acceleration in inflation could drive the Dollar higher.

The US economy defies the rules: 100 days into the Oil shock and the recession signal is still missing

More than three months after the start of the Iran war and the resulting disruption to global energy markets, the US economy continues to display remarkable resilience. The conflict has triggered a sharp rise in Oil prices, reignited inflationary pressures and fueled widespread concerns about a potential economic slowdown.