USD/MXN to trade in the range 19.20/19.80, Banxico to cut two more times in 2019 – Rabobank


At today’s meeting, the Bank of Mexico cut interest rates for the first time since 2014. According to analysts from Rabobank, it will continue in that direction with two more 25bp rate cuts. 

Key Quotes: 

“The statement was not that much more dovish than back in June but clearly global concerns are weighing, as is the recent stagnation of the domestic backdrop.”

“In terms of policy rates going forward, we haven’t changed our call with respect to the pace of rate cuts but we have of course brought forward the start of the easing cycle. Going forward, we now expect Banxico to cut by 25bp on two more occasions this year at the September 26th and November 14 th meeting, taking the policy rate down to 7.50%. That won’t be enough to discourage carry trade support for MXN but it is important to watch for a global EM rout that could drag MXN down and it is important to monitor domestic fiscal developments very closely as any further rating downgrades could trigger significant capital flights and MXN depreciation.”

“We maintain the view that USD/MXN to primarily trade a 19.20 to 19.80 range in the next 1-3 months.”

Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility.

Feed news

Latest Forex News

Editors’ Picks

AUD/USD stays under pressure around 0.6830 while beginning the NFP day

AUD/USD declines to 0.6830 during the initial Friday morning in Asia. The quote stretches losses made on Thursday as the second-tier Aussie data becomes the latest disappointment.

AUD/USD News

USD/JPY steady at 200-DMA ahead of critical US NFP data

Steady below the 200-day moving average, Yen fell from 108.97 to 108.66 overnight as positive trade deal headlines flowed through the news wires and helped US stocks eke out further gains. Risk appetite was solid into the close on Wall Street overnight.

USD/JPY News

US Non-Farm Payrolls November Preview: Labor market continues to defy concerns

Non-farm payrolls are predicted to rise 180,000 in Nov following Oct’s 128,000 increase. The unemployment rate is expected to be unchanged at 3.6%. Hourly earnings will gain 0.3% in Nov after October’s 0.2% increase and annual earnings will be stable at 3.0%.

Read more

Gold: Modestly changed to $1475 as markets turn cautious ahead of US NFP

Gold fails to extend the previous day’s recovery while trading near $1475/76 amid Friday’s Asian session. That said, the yellow metal registers failures to close beyond 50-day EMA for the third consecutive day.

Gold News

GBP/USD: 1.3180 holds the key to further upside

GBP/USD traders modestly changed around 1.3160 by the press time of early Asian session on Friday. That said, overbought conditions of the 14-day Relative Strength Index (RSI) and the recent stop in north-run make buyers doubtful.

GBP/USD News

Forex MAJORS

Cryptocurrencies

Signatures