hough the mood has deteriorated. US Treasury bond yields are almost flat, but the greenback gains ground against most G7 currencies. The USD/MXN is trading at 16.9288, down 0.44%.Wall Street turned negative as the North American session progressed. Existing Home Sales in the US slumped less than expected, still contracted at a -2.2% pace in July, driven by inventory availability and higher mortgage rates.
The USD/MXN is also falling as US bond yields at the long end of the curve fall. The exception is US 3-month and 2-year Treasuries, yielding 5.30% and 5.02%, respectively. According to recent words from Richmond Fed President Thomas Barkin noted, the move in yields is not a sign of “inappropriate” market tightening; instead, he said is a response to strong economic data.
Barkin added that if inflation stays high and the economy strengthens further, “that would make the case” for additional tightening., a gauge of the buck’s value against a basket of six currencies, has risen 0.25%, up at 103.579, but so far failed to gain traction against emerging market currencies. Aside from this, the Mexican economic docket would feature August 1st half inflation on August 24, which is estimated to decrease to 4.67% YoY and 0.28% on monthly figures. Meanwhile, Mexico’s economy minister Raquel Buenrostro told Reuters, “Mexico rules out modifying a decree on genetically modified corn ahead of a dispute settlement panel requested by the United States through the USMCA trade pact.
On the US front, the economic docket would feature Fed speakers, S&P Global PMIs, Durable Good Orders, andToday, the USD/MXN resumed its downtrend, after standing above the 17.0000 figure for the last 14 days, after clashing with the confluence of the 20 and 50-day Moving Averages at the 17.0000 figure, spurring a fall toward a daily low of 16.8930. Should be said a decisive break below that level, and the pair would challenge the year-to-date low of 16.6238.