USD/MXN surges to 12-week high on US Pres. Trump’s fresh tariff announcement

The US announces 5% tariffs on Mexican goods to push the nation for stopping migrants.
USMCA might also be up for voting in the Congress in the next 30 days.

Anil Panchal FXStreet

With the US President Donald Trump confirming previous speculations of a tariff increase on Mexico, the USD/MXN pair surged to the highest since March 08 by trading near 19.50 during early Friday.

The quote has recently been rising on expectations of harsh tariffs on Mexican goods from the US in order to tame illegal migration from its trading partner.

Read: USD/MXN: Bulls dominate on expected hardships from US Pres. Trump

However, tweet from the President Trump propelled the prices to the 12-week high as it said that the US will impose 5% tariff on all goods from Mexico form June 10th and the tariffs could rise to as high as 25% till until October if Mexico refrains from stopping the illegal inflow of aliens into the US.

Read: Developing story: Trump says the US to impose 5% tariff on all goods from Mexico

The official announcement of the tariff hike is still underway but is less likely to deviate from Mr. Trump’s tweet.

This is likely to have a negative impact on the US Congress’ voting on the USMCA (United States–Mexico–Canada Agreement) that will be up for a say by the US lawmakers in next 30 days

Technical Analysis

Having crossed 200-day simple moving average (SMA) prices may now aim for March month high of 19.62 ahead of dreaming for 19.72/73 and 20.00 round-figure.

On the downside, 200-day SMA level of 19.35 acts as immediate support, a break of which can recall 19.25 and 19.12 back to the chart.

Author

Anil Panchal

FXStreet

Anil Panchal has nearly 15 years of experience in tracking financial markets. With a keen interest in macroeconomics, Anil aptly tracks global news/updates and stays well-informed about the global financial moves and their implications.

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