Usdmxn Trades With A Downward Bias

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Usdmxn Trades With A Downward Bias

USD/MXN Trades Near 17.20 With A Downward Bias

USD/MXN is trading near the 17.29 handle with a downward bias during the Wednesday session. The recent FOMC minutes did provide support to the USD/MXN, but it looks like the upside was limited.

In the FOMC meeting, the US monetary policy was discussed, and how more tightening measures could be taken if the inflation is still out of the Fed's target range. In addition, the members of the FOMC also agreed on the fact that a restrictive policy is needed for the short to medium term to understand the inflation situation.

DXY Upside Remains Capped

Although the FOMC minutes were hawkish, it looks like the DXY didn't manage to materialize on it. As a result, the Dollar index is hovering near 103.60, with the nearest support at 103.50 and then the 103.00 handle. Although the yields on the long-term bonds have jumped higher, the positive sentiment didn't shift into the USD/MXN & other pairs.

On the Mexican side, the retail sales data is due, which is expected to show an uptick. In addition, the inflation for the 1st half month of November will also be released later today. According to experts, the CPI reading from Mexico is likely to rise a little, but the core CPI will show a little reduction.

In addition, the Bank of Mexico held a meeting some time ago, but it was not clear what was discussed. The minutes of that minute are now due to be released, which will also allow the traders to look into how Banxico will treat the interest rate issue.

According to forecasts, the growth rate of Mexico's economy will be around 2.9% by the end of October, based on a yearly basis.

Looking ahead, some medium-tier data is expected from the US side, while the Mexican side is light. However, the meeting minutes from Mexico's central bank will be a major volatility event.

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