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Peso Steady, Awaits Friday CPI Release

MEXICO
  • Monday's US Dollar weakness was largely reversed overnight where USDMXN briefly traded above 20.30 again. Gains have since been pared and the pair is marginally weaker from Sunday's open. Technically, despite the move higher, the unwind still appears to be a correction and focus on the upside is now resistance at 20.3805, Apr 5 high.
  • Some desks reported inflows remaining tepid, with several clients across the real money segment buying USDs to unwind and/or put on hedges.
  • On the data front Friday's release of Aril CPI will be the most significant, especially with Banxico's May meeting next week on Thursday 13th, where consensus estimates are for the committee to leave the rate unchanged at 4.00%.
  • In yesterday's Banxico survey, 2021 year-end inflation was raised to 4.58% from 4.17%.

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