Mexican Peso Slips on Slower GDP Growth

mxn_article image

The Mexican Peso (MXN) depreciated slightly following the release of preliminary GDP data for Q1 2024.

GDP Growth Slows, But Stays Positive

  • Mexico’s annual GDP growth rate came in at 1.6%, lower than the previous quarter’s 2.5%.
  • However, the quarterly growth rate improved to 0.2% compared to 0.1% in Q4 2023.

Lower Rates Expected, Peso Weakens

  • The weaker annual growth figure raises the possibility of another interest rate cut by Banxico, the central bank of Mexico.
  • This could reduce capital inflows to Mexico, weakening the Peso.
  • As of publication, USD/MXN trades at 16.97, EUR/MXN at 18.18, and GBP/MXN at 21.28.

Technical Analysis: USD/MXN Rangebound with Downward Bias

  • The USD/MXN pair remains stuck in a sideways trend, with support at 16.86 and resistance at 17.40.
  • The pair is currently in a downtrend within this range and could test the support level.
  • The MACD indicator suggests further downside momentum.

Breakout Watch

  • A confirmed breakout above 17.40 or below 16.86 would signal a change in direction.
  • A break below the support could lead to further weakening of the Peso, potentially reaching 16.50 or even 16.26.
  • A break above resistance could see a climb towards 17.67 and potentially 18.15.

Confirmation of a breakout requires:

  • A strong daily candlestick closing near its high/low, piercing above/below the range limits.
  • Alternatively, three consecutive daily candlesticks closing above/below the range.

Just before you go, get
100 daily signals

After registration, contact us via chat and

provide us with the code #100_signals