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The insights into exotic pairs: the MXN
The new agreement between the United States, Mexico and Canada did not result in the long-term strengthening of the Mexican currency. The key internal factor of the weak performance of the Mexican peso is connected with an uncertainty around the energy policy of the new president-elect. The other reason, which affects the currency negatively, is a suspension of the Mexico City international airport’s construction. A referendum on the continuation of the project will take place on the 25th of October. If the referendum fails, it will hurt the investor confidence and result in the outflow of the capital from the country. In addition, US president Donald Trump said he would close the southern border with Mexico due to the immigration issue. As a result, on a weekly chart, US dollar is trading against the Mexican peso at its September’s highs. If the peso disappoints investors, the pair will have the power to cross the resistance at 19.4874 and stick above the next resistance at 19.7160. In case the Mexican currency will be supported, the pair has a risk to fall below the support at 19.1096 to the next support at 18.8810.
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