USD/MXN Monthly Forecast: September 2024 (Chart)
Date
9/2/2024 12:04:56 AM
(MENAFN- Daily Forex)
The US dollar has shot straight up in the air like a rocket against the Mexican peso during the month of August, as we are threatening to break above the 20 pesos level. This is an area that has a lot of psychology attached to it as well as a lot of previous action.
Because of this, I think that the month of September might be a little bit more difficult than people are used to dealing with over the last several months. We have shot straight up in the air mainly due to the fact that there are a lot of
Political concerns when it comes to the Mexican government, and of course there are a lot of concerns when it comes that the US economy.
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The USD/MXN currency pair tends to be in its own world, because a strong US economy is actually better for the Mexican peso than it is for the US dollar. This is because Mexico is the world's largest exporter to the United States, passing China earlier in the year. In other words, the United States is the biggest consumer of Mexican goods, so obviously it has a direct correlation to the economy. Furthermore, there is a huge remittance flow in the Forex markets, and if the US economy starts to fall apart, Mexican immigrants tend to return home, and stop sending money back across the border. It's an odd thing to say with the currency pair, but it has a very real effect.
With all this being said, if this market were to break above the 21 pesos level during the month of September, you would probably see the US dollar take off again. However, I suspect that September will probably be more or less a situation where you see more consolidation than anything else, and perhaps even a pullback in the greenback. This is not something that I would be willing to trade though, just an observation. I think this is going to be a somewhat tough market in September and therefore probably not one you want to be heavily involved in.
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