The Mexican Peso is one of the best-performing EM currencies in the world, with a gain of nearly 6% YTD. This impressive performance has caused analysts at Société Générale to ponder the possibility of a move below 18.00 in the USD/MXN pair.
The USD/MXN pair has been on an upward trend since the start of the year and is currently trading at around 18.30. However, analysts at Société Générale believe that a move below 18.00 is possible, depending on the outcome of the US Federal Open Market Committee (FOMC) minutes and US Personal Consumption Expenditure (PCE).
The 50-day Moving Average (DMA) is currently located near 19.00 and is likely to provide resistance to any further increases in the USD/MXN pair. If the USD/MXN pair fails to hold above 18.30, then a persistent decline towards the lower band of a multi-month channel near 18.10 and 17.90/17.60 is likely.
Analysts at Société Générale have noted that the Mexican Peso has been one of the strongest performing EM currencies in the world, with a gain of nearly 6% YTD. This impressive performance has caused them to ponder the possibility of a move below 18.00 in the USD/MXN pair.
At present, the USD/MXN pair is trading at around 18.30 and is on an upward trend since the start of the year. However, analysts at Société Générale believe that a move below 18.00 is possible, depending on the outcome of the US Federal Open Market Committee (FOMC) minutes and US Personal Consumption Expenditure (PCE).
The 50-day Moving Average (DMA) is currently located near 19.00 and is likely to provide resistance to any further increases in the USD/MXN pair. If the USD/MXN pair fails to hold above 18.30, then a persistent decline towards the lower band of a multi-month channel near 18.10 and 17.90/17.60 is likely.
Analysts at Société Générale have further noted that this decline could be accelerated by any negative news from either the FOMC or the US PCE. The FOMC minutes will provide an insight into the US central bank’s current monetary policy stance, while the US PCE will provide an insight into the US economy’s performance.
In addition to this, analysts at Société Générale have also noted that the Mexican Peso’s performance could be affected by other external factors such as the US-China trade war and the US-Mexico border wall. These factors could have an impact on the Mexican economy and could lead to a further decline in the USD/MXN pair.
Overall, analysts at Société Générale believe that the Mexican Peso is one of the best-performing EM currencies in the world, with a gain of nearly 6% YTD. They also believe that a move below 18.00 in the USD/MXN pair is possible, depending on the outcome of the US Federal Open Market Committee (FOMC) minutes and US Personal Consumption Expenditure (PCE). The 50-day Moving Average (DMA) near 19.00 is likely to provide resistance to any further increases in the USD/MXN pair. If the USD/MXN pair fails to hold above 18.30, then a persistent decline towards the lower band of a multi-month channel near 18.10 and 17.90/17.60 is likely. This decline could be accelerated by any negative news from either the FOMC or the US PCE, as well as other external factors such as the US-China trade war and the US-Mexico border wall.
