USD/MXN continues the losing streak, moves down to near 17.16
USD/MXN extends its downward trend for the third consecutive session on Friday, slipping to 17.16 during the European session. Despite a stronger US Dollar following the US GDP release, the pair faces headwinds as recent data from Mexico provides support for the Mexican Peso (MXN).
The USD/MXN pair encounters challenges after Mexico’s 1st half-month inflation data released on Wednesday indicates a resurgence in inflation within the country. On Thursday, the Mexican Peso strengthened further as the Mexican Jobless Rate revealed a contraction in the number of unemployed workers, potentially dissuading the Bank of Mexico (Banxico) from considering a reduction in policy rates.
The non-seasonally adjusted Jobless Rate in Mexico decreased to 2.6% in December, aligning with expectations and down from the previous reading of 2.7%. The seasonally adjusted Jobless Rate remained stable at 2.8%. Analysts at BNP Paribas suggest that the recent inflation report in Mexico may act as a deterrent for Banxico from contemplating a policy easing. Traders will closely observe the upcoming US Personal Consumption Expenditures (PCE) data for further insights into the US economic landscape, which could influence the USD/MXN pair’s dynamics.