Forex - Mexico Flows: Back Over 19.30 Ahead of Pemex Plan


 12:05 (GMT) 15 Feb

  [Forex Flows]

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Mexico Flows: Back Over 19.30 Ahead of Pemex Plan (0101-JBGZ-C01)

MXN is coming from overnight trading weaker above 19.30. Global backdrop is mostly supportive, with US equities futures, better commodity prices and only marginal gains in DXY. The biggest concern today is the expected announcement by President Andres Manuel Lopez Obrador of Pemex financial support. The amount of support will be crucial as the market consider that Pemex needs at least US$10bn.

Data wise, there is no data in the domestic market until next week. In the US, we see Feb's Empire State manufacturing survey and Jan import price data. Jan industrial production follows, and we expect a 0.1% increase but a 0.4% fall in manufacturing to correct a strong Dec. Feb's preliminary Michigan CSI is due later and may see some recovery from a Jan dip with equites off recent lows and the government back open.

Market remains concerned that domestic policies could prompt rating actions. Globally market is starting to look towards a risk off mood that could keep MXN above 19.25. Any negative news on Pemex may add pressure towards 19.50.


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