A mix of good growth and Fed cuts is tactically bearish for USD/MXN in the very short run – TDS
Source Fxstreet
Economists at TD Securities like the Mexican Peso (MXN) and expect the USD/MXN pair to move lower.
The USD is overbought and expensive
After the recent correction higher in the USD, it does not look as cheap or oversold. It now looks more balanced versus not just macro drivers but also our positioning indicators. This means that the USD's move higher should run out of steam soon, and risk-reward tilts towards fading the USD strength.
Tactically, we like USD/MXN lower, reflecting a powerful mix of disinflation and good US data, which is a sweet spot for MXN until we have to worry about elections and cuts by Banxico.
Disclaimer: For information purposes only. Past performance is not indicative of future results.
Recommended Articles
Hurricane Isaias has shut in a quarter of Gulf oil output — can WTI clear $92 before Thursday's EIA report?WTI trades at $90.80 after rebounding roughly 3% from Wednesday's $87.96 low as Hurricane Isaias — the Atlantic season's first — forces producers to shut in about 25% of US Gulf of Mexico output. Brent holds at $103.41. The first official read on the disruption arrives with the EIA weekly petroleum report on Thursday 15 October — here are the key levels and both scenarios.
WTI trades at $90.80 after rebounding roughly 3% from Wednesday's $87.96 low as Hurricane Isaias — the Atlantic season's first — forces producers to shut in about 25% of US Gulf of Mexico output. Brent holds at $103.41. The first official read on the disruption arrives with the EIA weekly petroleum report on Thursday 15 October — here are the key levels and both scenarios.
US September CPI lands Wednesday with headline inflation seen at 3.7% y/y and core at 0.2% m/m. December hike odds sit near 70% — here are the scenarios, the calendar and the key levels.
Spot gold closed at $4,194.645, up 1.47% — its first weekly gain in three weeks — and COMEX futures settled back above $4,200 at $4,220.30. Here are the drivers, the levels and the scenarios into Wednesday's CPI.
West Texas Intermediate (WTI) declines after two days of gains, trading around $90.00 per barrel during Asian hours on Monday.
Brent swings $105.63 to $102.33 as Gulf risk meets an 'energy ceasefire' — can $100 hold into CPI?Brent spiked to $105.63 in Asian trade on fresh Middle East supply incidents, then reversed to $102.33 after the US announced a Russia-Ukraine 'energy ceasefire' and 300,000+ tonnes of Russian diesel headed to global markets; WTI fell through $90. Here are the drivers, the levels and the scenarios into Wednesday's US CPI.
Brent spiked to $105.63 in Asian trade on fresh Middle East supply incidents, then reversed to $102.33 after the US announced a Russia-Ukraine 'energy ceasefire' and 300,000+ tonnes of Russian diesel headed to global markets; WTI fell through $90. Here are the drivers, the levels and the scenarios into Wednesday's US CPI.
Related Instrument
