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MXN Consolidates Before Powell

MEXICO

No major data releases today in Latin America. The focus for markets will be on Chairman Powell's Congressional testimony, following the sharp rise in US yields over the past two weeks.


Further bear steepening in the local swaps curve continued to add pressure to the Peso yesterday. As markets attempt to digest the local developments, there has been a consolidation overnight in USDMXN, with a fairly contained trading range 20.68-20.7650. Nearest notable resistance remains 20.85 which could tie in with the daily downtrend resistance in EURMXN that comes in just under 25.30.


11:30am Local: Banxico to announce auction results of:

  • 5b pesos of 28-day Cetes, 7.4b pesos of 91-day Cetes, 14b pesos of 182-day Cetes, 12b pesos of 350-day Cetes
  • 11b pesos of Bondes D
  • 3.7b pesos of Mbonos due Nov. 2047
  • 600m udis of inflation-linked bonds due Nov. 2050

*No data today so focus turns to tomorrow where we will see Mexico Retail Sales and Bi-Weekly CPI at 1200GMT/0700ET.

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