30 Apr 2015
Mexican peso expected to strengthen – Rabobank
FXStreet (Edinburgh) - Strategist at Rabobank Christian Lawrence sees the Mexican currency gathering traction in the medium term.
Key Quotes
“Given the wider LatAm FX rally and strength of the Mexican data flow we are somewhat surprised at the lack of MXN strength”.
“In part we would blame this on carry attractiveness as the wider fall in volatility has made the likes of BRL and COP more attractive relative to the lower yielding MXN”.
“That said, CLP has the same policy rate as MXN and this still managed to eke out a small gain”.
“As it stands, we expect MXN to play catch-up and see a move lower in USD/MXN as the most likely path of least resistance”.
Key Quotes
“Given the wider LatAm FX rally and strength of the Mexican data flow we are somewhat surprised at the lack of MXN strength”.
“In part we would blame this on carry attractiveness as the wider fall in volatility has made the likes of BRL and COP more attractive relative to the lower yielding MXN”.
“That said, CLP has the same policy rate as MXN and this still managed to eke out a small gain”.
“As it stands, we expect MXN to play catch-up and see a move lower in USD/MXN as the most likely path of least resistance”.