The Mexican Peso (MXN) is experiencing a decline in its key pairs as traders brace for the release of crucial data on Thursday. This depreciation follows a trend of losses over the past few days, with MXN losing between 1.50% to 1.90% on Wednesday alone.
Investors are eagerly awaiting market-moving data from Mexico and Europe, as well as Federal Reserve Chairman Jerome Powell’s speech at Jackson Hole on Friday. Currently, one US Dollar (USD) buys 19.31 Mexican Pesos, EUR/MXN trades at 21.53, and GBP/MXN at 25.28.
Mexican Peso Weakens Against USD Despite Weak US Data
Despite negative economic news from the US, the Mexican Peso saw a 1.50% drop against the US Dollar on Wednesday. This decline occurred even after the release of disappointing Bureau of Labour Statistics (BLS) revisions to Nonfarm Payrolls and the US Federal Reserve’s July meeting Minutes.
The downward revision of 818,000 to payrolls for the previous year raised concerns about the US labor market and the economy. However, the US Dollar Index (DXY) hit a new year-to-date low before rebounding, indicating market volatility.
Data on the Horizon
Thursday will bring more data releases that could impact the Peso and its pairs. Mexican Inflation for August and Q2 GDP data will be published, along with Eurozone and UK preliminary PMIs for August and US PMIs.
Additionally, Eurozone wage negotiations data will be released, potentially affecting the trajectory of monetary policy by the ECB and the Euro.
Technical Analysis: USD/MXN Extends Gains
USD/MXN continues to rise, indicating a possible shift in the short-term trend. The pair may be entering a new up leg within its rising channel, with the potential to reach channel highs at around 20.50.
USD/MXN Daily Chart
Despite initial bearish patterns, USD/MXN has broken above key levels, suggesting a bullish trend. Medium and long-term time frames also support the view of an upward move.
Stay tuned for upcoming economic indicators that could further impact the Mexican Peso and global currency markets.