Mxn Gains On Us Data Turmoil

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Mxn Gains On Us Data Turmoil

Mexican Peso (Mxn) Gains On Us Data Turmoil

The rise in US inflation has paved the way for the Mexican Peso (MXN) to register some solid gains against the greenback. At the same time, the latest data shows that the trade balance of Mexico is in a deficit.

For now, the USD/MXN is trading near 17.13 with a change of -0.42% for the day. Even then, the USD/MXN is sitting at monthly highs, which suggests that the greenback is still the winner.

The US Department of Commerce has released the core PCE for March, which showed a higher annual reading than the forecast. In simple words, this is a sign that inflation has increased in the USA during March.

Usd/Mxn Trades Under 200 Sma

According to INEGI, Mexico has closed March with a budget deficit based on seasonal adjustments. Another metric released by the INEGI was the unemployment rate, which is below the forecasts.

Another factor underpinning the Mexican Peso (MXN) is the market mood, as major US indices are registering gains.

For now, the USD/MXN has dipped under the 200 SMA located at 17.16. In theory, this should be bullish for the MXN, but it appears that the Mexican currency is still on the defensive. Defensive price action like this has increased the chances of yet another bullish rally in the USD/MXN pair.

According to experts, a daily close under 200 SMA sends the USD/MXN towards the 17.01, 17.00 and then the 16.81 handle where 50 SMA is present. A consistent buying pressure in the MXN will send the USD/MXN pair towards the 16.62, the low of 2023.

Another scenario is that the USD/MXN reclaims the 200 SMA, which will mean yet another uptrend for the USD. In that case, the resistance levels at 17.16, 17.38, and 17.50 will play a key role in stopping the advance. Next up is the 17.92, which is the YTD high for the USD/MXN.

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