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Constitution Day Holiday, USDMXN Extends Higher

MEXICO
  • The extension of USD strength on Friday has notably impacted LatAm FX with the Mexican peso no exception. Price action has been exacerbated by USDMXN meeting an important support level around 18.50 last Thursday and the subsequent rally has now extended to around 3%. The first resistance point of note is at 19.1568, the 50-day EMA.
  • All 16 estimates in the Bloomberg survey are calling for a 25bp hike from Banxico on Thursday as the central bank continues to battle stubborn levels of core inflation. The MNI preview with analyst views will be published tomorrow.
  • Constitution Day in Mexico today so would expect newsflow to be very light. Formal job creation and gross fixed investment are scheduled data points today and tomorrow, however more significant inflation and production data are due later this week.

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