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Banxico Statement Awaited, USDMXN Edges Lower

MEXICO
  • All analysts are expecting Banxico to keep the overnight rate unchanged at 11.25%, in line with the current guidance from the committee. While inflation has continued to soften, the persistence of core inflation makes it difficult to foresee any shift in the committee’s stance at this juncture.
  • Furthermore, some hawkish remarks from a Deputy Governor emphasise the board remain firmly in data dependent mode. The full MNI preview with analyst views is here: https://roar-assets-auto.rbl.ms/files/55175/MNI%20Banxico%20Preview%20-%20August%202023.pdf
  • USDMXN has edged slightly below 17.05 overnight, slightly extending the pullback from 17.40 resistance met last week. Further downside pressure would refocus market participants on the bear trigger at 16.6262, the Jul 28 low. Initial support to watch lies at 16.9948, the 20-day EMA.

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