The USD/MXN pair is down by about 0.45% partly because of the overall weaker US dollar and the relatively stable crude oil prices. The pair is trading at 20.0460, which is slightly above this week’s low of 19.6870.
Mixed economic data from Mexico
The USD/MXN has declined even after a series of mixed economic data from Mexico. In a report today, the country’s statistics office said that the overall economic activity increased by 1.60% in October, better than the median estimate of 1.50%. This improvement was slightly better than the previous month’s increase of 1.20%. Still, the activity is still 5.30% lower than where it was in the same month in 2019.
Further data showed that the Mexican first-month consumer price index (CPI) increased by 0.34%, lower than the expected 0.38%. In the same month, the core CPI, which excludes the volatile food and energy products rose by 0.52%.
Early this week, data from the bureau showed that retail sales declined by 1.4% leading to an annualised contraction of 7.1%. This is evidence that the Mexican economy has been in significant pressure in the recent months.
Weaker dollar and higher oil prices
The USD/MXN is also falling because of the overall weaker US dollar and higher oil prices. The dollar index has fallen by 0.25% in part because of the falling global risks. Health experts believe that the current vaccines by Pfizer and Moderna will help prevent the coronavirus.
At the same time, there is optimism that the European Union and the UK will reach a Brexit agreement before the year ends. Most importantly, the GDP data from the US were impressive and congress
