- The Mexican peso weakens 0.29% compared to Greenback strength and market improvement.
- Trump says he does not remove Feditol Powell by alleviating investors' concerns about the independence of the central bank.
- Mexican retail disappointment; The Cit study shows that growing growth, a stable banotation rate reduces expectations.
Mexican peso (MXN) recorded modest damage in the middle of a healing on Wednesday appetite and restored confidence in Greenback when US President Donald Trump denied that he would remove the Chairman of the Federal Reserve (Fed) Jerome PowellTo. During this writing, the USD/MXN will trade at 7pm, which is 0.29%.
Markets digest the recent news that US President Donald Trump hardened his attacks on Powell, in addition to softening Chinese tariffs, with the aim of concluding an agreement with Beijing. The Wall Street Journal revealed that Washington was considering reducing Chinese responsibilities, although Trump warned that “it is not zero.”
Wall Street delighted the revolutionary news, although later commented on US Treasury Secretary Scott Bessent that Trump had not offered the unilaterally lower tariffs in China.
In Mexico, retail sales were lower than expected in February, according to the monthly and year data of the Instituto Nacional de Estadistica Geografia E informational (Ingi). In the meantime, Citi Mexico revealed his recent expectation survey, in which 34 economists updated their forecasts on economic growth, inflation, USD/MXN exchange rate and Banco de Mexico (Banxico) monetary policy.
There are traders of Mexican economic documents, who are the release of mid -month inflation and the publication of economic activities.
Daily Digest Market Movers: Mexican peso loses steam, as economists are waiting for Banxico surgery
- Central Bank Difference Banco de Mexico (Banxico) and FED favors even upside down in the USD/MXN. The Council of Banxico published its decision to continue to mitigate politics. In contrast, Fed is considered caution as some officials have shown concerns about the re -re -re -re -regulation of tariffs.
- Mexican retail sales in February fell from 0.7% to 0.2% to a mother, with less than 0.3% growth. Until 12 months, sales fell from 2.7% to -1% to -1%, showing a continuous economic slowdown.
- The Citi Mexican Expectation Survey shows that economists hope that Banxico would reduce their rate by 50 base points at the May meeting. Throughout the year, they project the main reference rate, which ends near 7.75%.
- In terms of the USD/MXN exchange rate, private analysts see an exotic pair of finishing 20.93 compared to 20.90. It is predicted to end with an inflation of 3.78%in 2025, with a basic number of 3.80%, mostly aligned with a previous survey.
- The Mexican economy will be expected to increase by 0.2% in 2025, which is less than 0.3% in the previous study.
- Mexican average monthly inflation is expected to rise from 3.67% to 3.79% and the main indicators, ranging from 3.56% to 3.77%.
USD/MXN Technical Outlook: Mexican peso is still a carcass as USD/MXN is less than 200-day SMA
After falling below the 200-day simple moving average (SMA) 19.91, the USD/MXN has become coarsely tilted, although it is 19.46 after a year's up-to-date (YTD) lowest hitting.
Buyers must reclaim a 200-day SMA, followed by a number of 20.00. The latest violation reveals near April 14th near the highest and 50-day SMA joining SMA 20.25-20.29 before testing the 100-day SMA 20.33.
On the contrary, the sellers could test at 19.50, followed by the current YTD low before 19.00.
Banxico FAQ -D
The Bank of Mexico, also known as Banxico, is the Central Bank of the National. Its mission is to maintain the value of Mexican currency, Mexican peso (MXN) and to establish monetary policy. For this, its main purpose is to maintain low and stable inflation at the target level – 3%in achieving or near this goal, in the center of the tolerance bar between 2 and 4%.
Banxico's main tool to guide monetary policy is to set interest rates. If inflation is higher than the target, the bank will try to tame it by raising tariffs, making it more expensive for households and companies to borrow money and thereby cooling the economy. Higher interest rates are generally positive about the Mexican Peso (MXN) as they cause a higher yield, making national investors a more attractive place. On the contrary, lower interest rates tend to weaken MXN. The key factor is the difference in the rate of USD or how Banxico interest rates are set compared to the US Federal Reserve (FED).
Banxico meets eight times a year and its monetary policy is largely influenced by the US Federal Reserve (FED) decisions. Therefore, the Central Bank's decision -making committee usually accumulates a week after the average. In doing so, Banxico responds and sometimes provides for monetary policy measures established by the Federal Reserve. For example, after the disease-19 pandemic, before the Fed raised rates made Banxico first, trying to reduce the possibilities of significant depreciation of Mexico peso (MXN) and prevent capital outflow, which can destabilize the country.
