USD/MXN: Peso to weaken gradually, shrugging off Banxico meeting – TDS

FXStreet Insights Team FXStreet

Economists at TD Securities do not expect a meaningful MXN reaction to Banxico's decision on Thursday as they consider it has been mostly priced in.

Banxico to fulfill its 25 bps hike promise

“We expect Banxico to hike in 25 bps on March 30 and hit terminal at 11.25%. We think the bar is high for the central bank to contradict its own forward guidance once again.”

“We do not expect a meaningful MXN reaction to Banxico's decision as we think it has been mostly priced in. However, we expect gradual weakening of MXN against the USD in the coming months.”

“We still expect USD/MXN levels at 20.00 by year-end, though we acknowledge risks are tilted to the downside.”

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FXStreet Insights Team

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