The Mexican peso is falling modestly against the US dollar on a quiet Monday session; during the last 30 days it has erased 2016 losses amid an improvement global outlook, a weak US dollar and after Banxico announcements.
Last week, the Federal Reserve left monetary policy unchanged and lowered interest rate expectation, pushing the US dollar to the downside. USD/MXN broke an important support around 17.60 and dropped further.
On Friday it bottomed at 17.22, hitting the lowest levels since January 4. Today it reached 17.48 but then pulled back toward 17.35, where it was trading. Back in February it was trading above 19.00.
“Despite the softer growth outlook, the MXN is likely to continue to benefit from improved risk sentiment as one of the most highly traded EM currencies, but by less than previously expected. As a result we have revised up our year-end USD/MXN forecast to 17.00 from 16.30 in our last report”, said analysts from Lloyds Banks.
(Market News Provided by FXstreet)
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