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BNP STEER Model Triggers Long USDMXN Entry

MEXICO
  • BNP Paribas have published that their STEER model suggests USDMXN is undervalued relative to its short-term fundamentals.
  • The pair’s fair value has also declined over the past week as Mexican equities rallied. However, the decline in spot appears 2.7 z-scores (-1.6%) too extreme to the model.
  • Their Short-Term Equilibrium Exchange Rate Model has therefore initiated a long USDMXN position at 19.1068, targeting 19.4278 and with a stop loss at 18.7858.

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