Daily digest market movers: Mexican Peso is bolstered by US Dollar weakness
- USD/MXN would continue to be driven by market mood and expectations for a bigger Fed rate cut.
- Mexico’s economic docket next week will feature Aggregate Demand and Private Spending for the second quarter of 2024.
- Mexico’s Inflation dipped below 5% in August, increasing the chances of additional easing by Banxico.
- September’s Citibanamex Survey showed that Banxico is expected to lower rates to 10.25% in 2024 and to 8.25% in 2025. The USD/MXN exchange rate is forecast to end 2024 at 19.50 and 2025 at 19.85.
- The UoM Consumer Sentiment index rose from 67.9 to 69.0, exceeding estimates of 68.
- Inflation expectations improved from 2.8% to 2.7% for the one-year period. For a longer term, they rose from 3% to 3.1%.
- Greenback remained offered in the US after the US Bureau of Labor Statistics revealed that the August PPI figures were mixed. At the same time, the number of Americans filing for unemployment benefits rose as estimated and cleared the previous week's reading.
- Data from the Chicago Board of Trade suggests the Fed will cut at least 98 basis points this year, down from 108 a day ago, according to the fed funds rate futures contract for December 2024.
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