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Forex: USD/MXN flat ahead of rate decision

FXstreet.com (Barcelona) - The Mexican peso is trading in a narrow range between 12.1600 and 12.1800 on Friday, ahead of Retail Sales in the Aztec economy and the more relevant Banxico meeting, with consensus expecting the central bank to stay put at 4.0%.

According to Annette Beacher, FX Strategist at TD Securities, “There is a possibility that the market will find in the MPC’s guidance reasons to believe in further easing…. So we’re of the view that the risk of a ‘neutral’ message is higher, supporting a normalization of market implied rate expectations (currently 10-12bp of easing priced in 6m-9m)”.

At the moment, the cross is down 0.05% at 12.1620.
Next support levels align at 12.0626 (low Apr.15) ahead of 12.0189 (low Apr.11) and finally the psychological level at 12.0000.
On the upside, a breakout of 12.2043 (MA10d) would expose 12.3535 (high Apr.22) and then 12.3750 (high Apr.23).

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The GBP/USD found higher demand during early Asian session which lifted the pair by 40 pips to 1.5472 high. Profit taking pulled gains back and tested 1.5320 for support on the London session before a fresh upside momentum. The pair jumped about 30 pips to 1.5460 session high in a matter of 30 minutes as the GBP/USD attempts to resume yesterday’s jump above the 1.5400 psychological level.
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