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MXN Resilient Despite Greenback Strength

MEXICO
  • USDMXN was able to plunge to fresh lows of 19.5065 following yesterday’s Fed decision and despite a significant USD reversal on Powell’s hawkish posture in the press conference, the Peso is performing relatively well.
    • The pair remains below the key 19.75 mark which broke on Tuesday and a consolidation below this point will be key for bears. 19.4136, the May 30 low, remains the next target on the downside.
  • No major data releases for the rest of the week as markets return from the local holiday on Wednesday. Focus turns to the US jobs report on Friday, which will be the key driver for global markets heading into the weekend.
  • Continued pressure on core inflation and a hawkish Fed bolsters the likelihood of Banxico hiking by 75bps to 10.00% at next Thursday’s meeting.

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