- Mexican peso holds bullish bias versus the US dollar after surging in May.
- USD/MXN tests levels under 22.00 again, but remains unable to stay below.
The USD/MXN pair is trading slightly above 22.00 after hitting at 21.92 a fresh two and a half month low. It is modestly lower for the day, about to post the third consecutive decline and the tenth out of the last eleven trading days. The trend still points to the downside, but the 22.00 area is becoming a strong support.
On a relatively quiet session across financial markets, the Mexican peso rose modestly versus the greenback. The US dollar weakened at the beginning of June, sending the DXY below 98.00, to the lowest in two months.
Mexico and US: data off lows but still on contraction territory
The ISM Manufacturing index for May showed a recovery to 43.1 from the 41.5 registered in May. Analysts at Wells Fargo argue that after some of the worst months on record, today’s report is a step in a better direction.
In Mexico, the IHS Markit Manufacturing PMI rose from a record low of 35 in April to 38.3 in May. Despite the recovery, the index remained sharply low as many businesses stayed closed amid lockdown restrictions.
"Although the latest PMI results revealed a broad-based rise in index readings, the figures remained below 50.0, pointing to further reductions from April's already low base. That said, the rates of decline in key metrics such as output and new orders eased during May, suggesting that contraction are beginning to bottom out. Moreover, with the recent announcement that restrictive measures are to be gradually removed, the trend towards recovery should accelerate over the coming weeks”, commented Eliot Kerr, an economist at IHS Markit.
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers. The author will not be held responsible for information that is found at the end of links posted on this page.
If not otherwise explicitly mentioned in the body of the article, at the time of writing, the author has no position in any stock mentioned in this article and no business relationship with any company mentioned. The author has not received compensation for writing this article, other than from FXStreet.
FXStreet and the author do not provide personalized recommendations. The author makes no representations as to the accuracy, completeness, or suitability of this information. FXStreet and the author will not be liable for any errors, omissions or any losses, injuries or damages arising from this information and its display or use. Errors and omissions excepted.
The author and FXStreet are not registered investment advisors and nothing in this article is intended to be investment advice.
Recommended content
Editors’ Picks
EUR/USD resumes slide below 1.0500
EUR/USD gained modest upward traction ahead of Wall Street's opening but resumed its slide afterwards. The pair is under pressure in the American session and poised to close the week with losses near its weekly low at 1.0452.
GBP/USD nears 1.2600 as the US Dollar regains its poise
Disappointing macroeconomic data releases from the UK put pressure on the British Pound, yet financial markets are all about the US Dollar ahead of the weekly close. Demand for the Greenback increased in the American session, pushing GBP/USD towards 1.2600.
Gold pierces $2,660, upside remains capped
Gold (XAU/USD) puts pressure on daily lows and trades below $2,660 on Friday’s early American session. The US Dollar (USD) reclaims its leadership ahead of the weekly close, helped by rising US Treasury yields.
Broadcom is the newest trillion-dollar company Premium
Broadcom (AVGO) stock surged more than 21% on Friday morning after management estimated on Thursday’s earnings call that the market for customized AI accelerators might reach $90 billion in fiscal year 2027.
Can markets keep conquering record highs?
Equity markets are charging to new record highs, with the S&P 500 up 28% year-to-date and the NASDAQ Composite crossing the key 20,000 mark, up 34% this year. The rally is underpinned by a potent mix of drivers.
Best Forex Brokers with Low Spreads
VERIFIED Low spreads are crucial for reducing trading costs. Explore top Forex brokers offering competitive spreads and high leverage. Compare options for EUR/USD, GBP/USD, USD/JPY, and Gold.