Mexico CB Gov Heath: We will have to wait till December see if core inflation reaches peak

• We will have to wait until December to see if core inflation reaches peak
• we'll have to see what US Federal Reserve does with regards to its rates hiking cycle
• core inflation is the most important variable it is analyzing
• will have to compare accumulated interest rate hike between Banxico and US Fed

Deputy Governor Espinosa adds:

• need to look for clear inflection point in headline and core inflation
• what US the Fed does is important variable but underscores Banxico is autonomous
• sometimes we go in line with US Fed, sometimes we don't

Gov Esquivel adds:

• Banxico rate hikes could begin to deviate from Fed

Looking at the long-term weekly chart of the USDMXN, the price moved to a new low going back to March 2020 this week, and moved further away from a swing area between 19.4099 and 19.5950 (see yellow area in the chart below). The price is currently trading at 19.3700, and moved toward the lower end of that swing area. It would take a move above to give the buyers more confidence than a low may be in place.