USDMXN rebounds today amid USD strength recovering some of yesterday’s losses. The Mexican peso was on-demand yesterday after better than expected industrial output figures.
U.S. CPI Above Forecasts
Earlier today, reported that the U.S. Consumer Price Index (CPI) came in at 0.6%, topping the economist’s forecasts of 0.3% in July. The yearly reading for the U.S. CPI came in at 1% above the expectations of 0.8%. The Annual core CPI rise to 1.6% in July beating the estimates of 1.1%.
Yesterday the Mexico Industrial Output came in at 17.9% in June smashing the expectations of -3.1%. The yearly Industrial Output registered in at -16.7%, also beating the expectations of -17.8%. Manufacturing led the strong rebound while utilities and mining lagged.
Traders will focus tomorrow on Central Bank of Mexico (BANXICO) interest rates decision with expectations for a cut of 50 basis points or 75 basis points. The interest rate in Mexico is at 5% while the inflation climbed to 3.3% in June. Mexico’s GDP contracted by 17.30% in the second quarter of the year.
USDMXN Price Daily Analysis
USDMXN is 0.07% higher at 22.3775 as the pair tries to regain the positive momentum above the 50-day moving average while managed to break above the descending trend line that started on April 24. Since July the pair hovers above and below the 50-day moving average but can’t find the power to initiate a new trend. The technical picture is neutral, and traders should wait for a catalyst.
On the downside, minor support stands at 22.2659 the daily low. More bids would emerge at 21.9553 the low from July 31. Strong support would provide the 200-day moving average at 21.3003.
On the other hand, an initial resistance for USDMXN is at 22.4939 today’s high. The next hurdle for USDMXN pair would be met at 22.7304 the high from August 5. A break above the 100-day SMA at 23.0439 would signal a new bullish trend.
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USDMXN Daily Chart
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