FXStreet (Edinburgh) – The research team at JP Morgan expects the pair to extend to upside in the next months and the Mexican central bank to hike rates twice in by year-end.
Key Quotes
“We continue to expect USD/MXN to peak in 3Q15, under the assumption that Fed liftoff transpires in September”.
“Low inflation and lackluster activity momentum continue to suggest that Banxico will hike only after the Fed”.
“JPMorgan economists continue to forecast a 25bp monetary policy rate hike in October, followed by another 25bp hike in December, anchoring the interest rate differential, and thus preventing material exchange rate weakness putting pressure on expected inflation”.
(Market News Provided by FXstreet)