USD/MXN extends slide below 19.50, to lowest in two weeks
- Mexican Peso accelerates the upside versus US Dollar after breaking key technical level.
- US data in line with expectations, Mexican activity stagnates in October.
The USD/MXN broke under 19.50 and quickly fell further hitting 19.40, for the first time since December 5. The pair remains near the low, under pressure as the US Dollar posts mixed results on Friday.
Economic data from the US showed the Core Personal Consumption Expenditure Price Index rose 0.2% in November, in line with expectations. A different report showed Durable Goods Orders dropped 2.1%, against expectation of a 0.6% slide. The numbers did not have a significant influence on the US Dollar.
In Mexico, the Economic Activity index stagnated in October, against expectations of a 0.3% increase. Compared to a year earlier, the index rose 4.40%. On Thursday, inflation that came in mixed with the headline index rising after six consecutive drops (from 7.46% to 7.77%), while the core rate slowed down (8.37% to 8.35%).
Levels to watch
The consolidation below 19.70 left the USD/MXN vulnerable to more losses. Recently it broke the 19.50 support area falling to as low as 19.40. The bearish bias prevails with the next relevant support at 19.30. A recovery back above 19.50 would alleviate the pressure. The next resistance stands at 19.60, with a recovery above adding strength to the US Dollar.
USD/MXN daily chart