Mexican Peso depreciates as traders eye Banxico rate cut
The post Mexican Peso depreciates as traders eye Banxico rate cut appeared on BitcoinEthereumNews.com.
Mexican Peso declines for fourth day as USD/MXN recovers from daily low of 19.29. Mexico’s Economic Activity expanded in July, but Retail Sales contracted for the third consecutive month, fueling Peso weakness. Citibanamex survey shows most economists expect Banxico to cut rates by 25 bps on Thursday, with some forecasting a 50-bps cut. The Mexican Peso extended its losses for the fourth straight day against the Greenback, erasing earlier gains as traders digested mixed economic data from Mexico, while S&P Global revealed that business activity in the US remains solid but ticked lower. The USD/MXN trades at 19.45, bouncing off a daily low of 19.29, gaining 0.21%. Mexico’s Instituto Nacional de Estadística Geografía e Informatica (INEGI) revealed that Economic Activity expanded in July, while Retail Sales contracted for the third straight month, yet improved compared to June’s reading. Mexico’s economic docket will reveal September’s mid-month inflation figures on Tuesday, ahead of the Bank of Mexico (Banxico) monetary policy decision on Thursday. Citibanamex Expectations Survey showed that 28 of 36 economists await a 25-basis-point (bps) rate cut by the Mexican central bank. It’s worth noting that six of them forecast a 50 bps cut, and two others project the next cut until November 2024. Across the border, US Flash PMIs were mixed, with manufacturing activity contracting deeper while services continued to underpin the economy. The Atlanta Fed GDP Now model estimates the US economy will grow 2.9% in the third quarter and will be updated on Friday following data releases. Recently, the USD/MXN extended its losses after Fed speakers acknowledged that the risks of the labor market weakening had increased. However, they pushed back against lowering interest rates at a 50 bps pace, keeping their options open for the upcoming meetings. Daily digest market movers: Mexican Peso retreats as Fed officials…
Filed under: News - @ September 23, 2024 6:25 pm