MEXICO: USDMXN Surges as Hawkish Fed Outweighs Cautious Banxico
Sep-23 10:26
- Post-Fed dollar strength continues to play out nicely against the Mexican peso on Wednesday, with the most recent price extension amplified by yesterday’s break of trendline resistance, drawn from the year’s high. Topside momentum has built nicely above this line break around 17.25, and the pair is currently testing the 17.40 mark ahead of the NY crossover.
- While relative optimism surrounding trade talks with the US and a cautious leaning Banxico had been viewed as significant positives for the peso across much of 2026, the hawkish Fed meeting last week appears to be dominating the short-term narrative, bolstered by the latest technical developments.
- On the topside, the next levels to note are at 17.5390 (Jul 29 high) and 17.6764 (Jun 24 high), which could potentially come into play over Thursday’s Banxico decision should the committee be more upbeat on the recent progress for inflation.
- It’s worth noting that ahead of tomorrow’s decision, July economic activity and mid-Sep CPI data are scheduled.
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US 10YR FUTURE TECHS: (U6) Trend Needle Continues To Point South
Aug-24 10:25
- RES 4: 109-17 High Jul 17
- RES 3: 109-12+ 23.6% retracement of the Mar 2 - Jul 31 bear leg
- RES 2: 109-03+ High Aug 13
- RES 1: 108-31 50-day EMA
- PRICE: 108-14+ @ 11:14 BST Aug 24
- SUP 1: 107-31+ Low Jul 31 and the bear trigger
- SUP 2: 107-29 1.618 proj of Apr 17 - May 4 - 7 swing
- SUP 3: 107-20+ 1.764 proj of Apr 17 - May 4 - 7 swing
- SUP 4: 107-06+ 2.000 proj of Apr 17 - May 4 - 7 swing
Treasuries continue to trade inside a range and price remains below the 50-day EMA, currently at 108-31. A clear break of the 50-day average is required to highlight a stronger short-term bull cycle. For now, trend signals are bearish and gains are considered corrective. Attention is on the key support and bear trigger at 107-31, the Jul 31 low. Clearance of this level would confirm a resumption of the downtrend.
BELGIUM AUCTION RESULTS: Aug-31 OLO / Jun-36 OLO / Jun-45 OLO
Aug-24 10:20
| 3.10% Aug-31 OLO | 3.40% Jun-36 OLO | 3.75% Jun-45 OLO | |
| ISIN | BE0000368770 | BE0000366758 | BE0000331406 |
| Amount | E825mln | E1.266bln | E920mln |
| Previous | E790mln | E1.018bln | E845mln |
| Avg yield | 3.260% | 3.805% | 4.389% |
| Previous | 3.142% | 3.480% | 4.188% |
| Bid-to-cover | 2.06x | 1.93x | 2.05x |
| Previous | 2.16x | 2.06x | 1.22x |
| Avg Price | 99.273 | 96.720 | 91.920 |
| Low Price | 99.26 | 96.70 | 91.88 |
| Pre-auction mid | 99.203 | 96.598 | 91.771 |
| Prev avg price | 99.807 | 99.328 | 94.276 |
| Prev low price | 99.79 | 99.29 | 94.14 |
| Prev mid-price | 99.733 | 99.203 | 94.084 |
| Previous date | 27-Jul-26 | 25-May-26 | 23-Mar-26 |
LOOK AHEAD: A Quiet Start To An Important US Week
Aug-24 10:05
A quiet start to the week before it picks up tomorrow with the Conference Board consumer survey and 2Y supply.
US Data/Speaker Calendar (prior, estimate). All times ET:
- 08/24 0830 Chicago Fed National Activity (-0.02, -0.05)
- 08/24 1130 US Tsy sells $92bn 13-wk, $79bn 26-wk bills
- 08/24 1430 Trump participates in Rose Garden Event
Source: Bloomberg / MNI
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