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USDMXN Bounces Back Firmly Amid Higher US Yields, Waning Equities

  • USDMXN resides close to unchanged from Wednesday’s pre-fed levels, after recovering almost 2% from yesterday’s lowest levels around 20.22. Higher treasury yields and renewed weakness for equity indices is contributing to the weaker Peso.
    • 20.6378, the Apr 28 high continues to mark an important resistance and a clear break would suggest potential for an extension higher.
    • This would open 20.6830 (tested) and 20.9829, the 61.8% and 76.4% retracements of the Mar - May bear leg. Initial support is around 19.9099, the 20-day EMA.
  • President AMLO will visit Oaxaca to meet with those affected by Hurricane Agatha at the beginning of the month.
  • Banxico to present 1Q report on regional economies – Scheduled for 11am Mexico City time.
  • There are no major data releases for Mexico this week. Banxico will meet next Thursday where a 75bp hike is expected.

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