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26 Apr 2013
Forex: USD/MXN flat ahead of rate decision
FXstreet.com (Barcelona) - The Mexican peso is trading in a narrow range between 12.1600 and 12.1800 on Friday, ahead of Retail Sales in the Aztec economy and the more relevant Banxico meeting, with consensus expecting the central bank to stay put at 4.0%.
According to Annette Beacher, FX Strategist at TD Securities, “There is a possibility that the market will find in the MPC’s guidance reasons to believe in further easing…. So we’re of the view that the risk of a ‘neutral’ message is higher, supporting a normalization of market implied rate expectations (currently 10-12bp of easing priced in 6m-9m)”.
At the moment, the cross is down 0.05% at 12.1620.
Next support levels align at 12.0626 (low Apr.15) ahead of 12.0189 (low Apr.11) and finally the psychological level at 12.0000.
On the upside, a breakout of 12.2043 (MA10d) would expose 12.3535 (high Apr.22) and then 12.3750 (high Apr.23).
According to Annette Beacher, FX Strategist at TD Securities, “There is a possibility that the market will find in the MPC’s guidance reasons to believe in further easing…. So we’re of the view that the risk of a ‘neutral’ message is higher, supporting a normalization of market implied rate expectations (currently 10-12bp of easing priced in 6m-9m)”.
At the moment, the cross is down 0.05% at 12.1620.
Next support levels align at 12.0626 (low Apr.15) ahead of 12.0189 (low Apr.11) and finally the psychological level at 12.0000.
On the upside, a breakout of 12.2043 (MA10d) would expose 12.3535 (high Apr.22) and then 12.3750 (high Apr.23).