Mexican Peso ignores rate hike talk, hovers around record lows

Speculation that the central bank of Mexico could hike rates by 200 basis points is failing to lift the Mexican Peso, leaving it in its most vulnerable state around the record lows against the US dollar.

At the time of writing, the USD/MXN pair was trading around 20.54 levels, compared to yesterday’s record closing of 20.5766. The pair clocked a record intraday high of 20.7825 on Wednesday following Trump’s victory in the US Presidential elections.

Mexican central bank is certainly under pressure to defend its currency, although markets fear that would not be enough if Trump does build a wall across the border.

USD/MXN Technical Levels

The immediate resistance is seen at 20.7825 (record highs), above which sky is the limit given the uncertainty regarding the border issue. On the lower side, support is seen directly at 19.923 (Sep 26 high) and 19.521 (June 24 high).