|

USD/MXN falls to lows since 2015 following US Core CPI

  • USD/MXN printed a fresh cycle low on Friday of 16.62 and is poised to close a 1.70% weekly loss.
  • Core US CPI retreated to 4.1% YoY in June.
  • Falling US yields limit the Greenback’s advance as markets start to place bets on the September meeting.

On Friday, the USD/MXN pair fell to its lowest point since December 2015, this time weakened but soft Core Personal Consumption Expenditures (PCE) figure from June.

In that sense, the figures, which act as an essential gauge of inflation for the Federal Reserve (Fed), dropped to 4.1% YoY in June, lower than the 4.2% expected and the previous 4.6%. Its worth noticing that regarding September’s meeting, Jerome Powell added that the Fed can pause or hike and will depend solely on the data, so soft inflation figures make a case for a pause stronger, making the US yields decrease across the board.

However, the economic outlook from the US is strong as on Thursday, positive Q2 Gross Domestic Product (GDP) was reported, along with robust Durable Goods and Jobless Claims data. That being said, the next two set of inflation and job report figures before the Federal Open Market Committee (FOMC) meeting will be the ones which model the tightening expectations.

USD/MXN Levels to watch

The daily and weekly charts show that the technical outlook is bearish. On the daily chart, the Relative Strength Index (RSI) and the Moving Average Convergence Divergence (MACD) hint at the bears holding strong momentum while the pair trades below the 20,100 and 200-day Simple Moving Averages (SMA).

Support levels: 16.60, 16.50, 16.30.
Resistance levels: 16.90 (20-day SMA), 17.00, 17.20.

USD/MXN

Overview
Today last price16.6785
Today Daily Change-0.1939
Today Daily Change %-1.15
Today daily open16.8724
 
Trends
Daily SMA2016.9381
Daily SMA5017.2133
Daily SMA10017.6686
Daily SMA20018.403
 
Levels
Previous Daily High16.9084
Previous Daily Low16.7037
Previous Weekly High17.0512
Previous Weekly Low16.6924
Previous Monthly High17.7286
Previous Monthly Low17.0243
Daily Fibonacci 38.2%16.8302
Daily Fibonacci 61.8%16.7819
Daily Pivot Point S116.748
Daily Pivot Point S216.6235
Daily Pivot Point S316.5433
Daily Pivot Point R116.9527
Daily Pivot Point R217.0329
Daily Pivot Point R317.1573

Author

Patricio Martín

Patricio is an economist from Argentina passionate about global finance and understanding the daily movements of the markets.

More from Patricio Martín
Share:

Editor's Picks

AUD/USD extends the range play above 0.7200 as traders await US inflation data

AUD/USD is seen extending its consolidative price move above 0.7200 during the Asian session on Thursday amid mixed cues. Rising RBA rate-hike bets keep the Aussie close to its highest level since May 14. However, hawkish Fed expectations and escalating US-Iran tensions offer some support to the US Dollar, capping the currency pair as traders await US inflation figures.


USD/JPY consolidates around 153.50 as bears turn cautious ahead of US inflation

USD/JPY stabilizes above 153.50 during the Asian session on Thursday, but remains near a seven-month low set earlier this week as hawkish BoJ repricing continues to underpin the Japanese Yen. Meanwhile, rising September Fed rate-hike bets and escalating US-Iran tensions help ease US Dollar selling pressure, offering some support to the currency pair ahead of US inflation figures.

Gold sticks to gains, eyes $4,450 as USD remains depressed ahead of US inflation data

Gold turns higher following an intraday dip to sub-$4,400 levels, and moves further away from a one-week low touched the previous day. The commodity, however, remains below the $4,450 pivotal point as bulls seem hesitant ahead of US inflation figures. The US Producer Price Index report will be published later today, while the US Consumer Price Index is due on Friday.

Raydium's rally signals trend reversal amid network growth, buyback

Raydium maintains a firm bullish tone, posting nearly 9% gains, and extending its 41% rally from Sunday. Solana-based Decentralized Exchange is witnessing a surge in network activity and growth amid new token launches. The technical outlook for Raydium signals a potential upside toward $1.50 as momentum holds firm despite overbought conditions.

European Central Bank to resume interest rate hikes in September as inflation, energy risks rise

The European Central Bank is expected to raise the interest rate on the Main Refinancing Operations and the Deposit Facility by 25 basis points to 2.65% and 2.50%, respectively. The ECB will announce the decision on Thursday at 12:15 GMT.

Venezuela’s 65-billion-barrel Oil deal could reshape America’s inflation fight
The United States (US) has secured unprecedented access to part of Venezuela’s vast Oil reserves. The timing is particularly significant as the war with Iran is disrupting Middle Eastern supplies, keeping energy prices elevated and reviving concerns about inflation.