The Mexican Peso rises after robust US and domestic automobile data suggest a strong export outlook.
Moves by judges to block contentious reforms to the judiciary further support the MXN.
USD/MXN breaks below the key 50-day SMA and tests the bottom of a major rising channel.
The Mexican Peso (MXN) strengthens for the sixth day in a row on Monday, gaining in all three of its key pairs (USD/MXN, EUR/MXN, and GBP/MXN). The catalyst for the rise is a mixture of a more benign outlook for its most significant trading partner, the United States (US) – following better-than-expected US employment data – as well as recent robust domestic data from Mexico.
Data out on Friday showed US Nonfarm Payrolls (NFP) beat expectations by a wide margin in September, rising by 254K when economists had only expected a 140K increase, according to data from the Bureau of Labor Statistics (BLS). In addition, the Unemployment Rate fell to 4.1% from 4.2% when markets had feared the opposite. The data overall showed the US economy remains in good shape, averting fears of a “hard landing”.
In Mexico, meanwhile, both Automobile Production and Exports rose in September. Production climbed 11.71% from 8.3% in the previous month, and exports by 4.8%, up from 1.7% in August. That said, Mexico’s Jobless Rate in August hit 3.0%, which was above July’s 2.9%, according to data from the Instituto Nacional de Estadistica y Geografia (INEGI).
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