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The Mexican Peso (MXN) edges higher in most pairs on Friday as investor risk appetite remains strong, supporting commodity-related currencies and risk-sensitive FX such as the Mexican Peso.\u00a0<\/p>\n
Asian markets tracked Wall Street higher overnight as fears melted away following the slightly dovish outcome of Wednesday\u2019s Federal Reserve (Fed) meeting. Investors had started to fear the Fed<\/a> might suddenly change its course and start raising interest rates amid persistent inflation.\u00a0\u00a0\u00a0<\/p>\n USD\/MXN is trading at 16.96, EUR\/MXN at 18.22 and GBP\/MXN at 21.28, at the time of publication during the European session.\u00a0<\/p>\n The Mexican Peso weakened temporarily on Thursday after the release<\/a> of the S&P Global Manufacturing PMI for Mexico. The survey of purchasing managers in the Manufacturing sector showed a fall to 51.0 in April, down from 52.2 in March and 52.3 in February. It was the third monthly decline in a row, although the metric remains in expansive territory (above 50) \u2013 and at historic highs for the Index.\u00a0\u00a0<\/p>\n Fierce competition from rival firms in China and weak overseas demand were seen as major factors in the slowdown.\u00a0<\/p>\n \u201cA renewed fall in production volumes is a strong indication of how detrimental competitive conditions and weak international sales were to Mexican manufacturers at the start of the second quarter,\u201d said Pollyanna De Lima, Economics Associate Director at S&P Global Market Intelligence.<\/p>\n The fall in overseas demand was offset to a certain degree by continued robust domestic demand.<\/p>\n \u201cMexico’s domestic market fared better in comparison, neutralizing the weakness in overseas demand. Total new orders rose for the third consecutive month in April, amid<\/p>\n reports of successful advertising, demand resilience and the upcoming elections,\u201d the report said.\u00a0<\/p>\n Although respondents in the PMI<\/a> survey reported a rise in the cost of components, manufacturers on the whole absorbed the rise themselves, keeping prices of finished goods stable.<\/p>\n \u201cInput price inflation remained elevated, but manufacturers kept prices charged from customers broadly unchanged amid ongoing efforts to secure new work,” noted Pollyanna de Lima.\u00a0<\/p>\n Also on Thursday, Business Confidence for Mexico\u2019s industrial sector fell to 54.2 from an upwardly revised 54.4 in March, according to data from INEGI.\u00a0\u00a0<\/p>\n Foreign Exchange Reserves held by Banxico remained unchanged at $220B in March, and Mexico\u2019s fiscal balance showed a widening of the deficit to $437.2B, according to the Secretar\u00eda de Hacienda y Cr\u00e9dito P\u00fablico.\u00a0<\/p>\n In a poll of private analysts, headline inflation was expected to rise to 4.20% in 2024, up from the March estimate of 4.10%, revealed Banxico.<\/p>\n USD\/MXN continues its short-term sideways trend, oscillating between the parameters of a range with a floor at 16.86 and a ceiling at 17.40.\u00a0<\/p>\nMexican Peso temporarily weakens after release of Manufacturing PMI\u00a0<\/h2>\n
Inflation absorbed<\/h3>\n
Technical Analysis: USD\/MXN in sideways short-term trend\u00a0<\/h2>\n
USD\/MXN 4-hour Chart\u00a0<\/h3>\n