Bank of Mexico Cenbank: Board members will assess the magnitude of the upward adjustments

The Bank of Mexico meeting minutes are trickling out:

• Board members will assess the magnitude of the upward adjustments to the reference rate based on the prevailing conditions
• Board member Esquivel said I consider it necessary to start reducing the pace of the hiking cycle, and that this was a signal that we are nearing the cycles of terminal rate and would also be consistent with the current balance of risks
• All board members highlighted that food merchandise inflation Inflation Inflation is defined as a quantitative measure of the rate in which the average price level of goods and services in an economy or country increases over a period of time. It is the rise in the general level of prices where a given currency effectively buys less than it did in prior periods.In terms of assessing the strength or currencies, and by extension foreign exchange, inflation or measures of it are extremely influential. Inflation stems from the overall creation of money. This money is m Inflation is defined as a quantitative measure of the rate in which the average price level of goods and services in an economy or country increases over a period of time. It is the rise in the general level of prices where a given currency effectively buys less than it did in prior periods.In terms of assessing the strength or currencies, and by extension foreign exchange, inflation or measures of it are extremely influential. Inflation stems from the overall creation of money. This money is m Read this Term is the one facing the greatest pressures
• All board members pointed out that the core inflation continued trending upwards, reaching 8.42% in October, and most members highlighted that it has been increasing for 23 months
• All board members agreed that some of the shocks that have affected inflation have shown signs of easing, and pointed out the lower pressures on supply chains
• Most of board members highlighted that according to timely information, the Mexican economy continued recovering during the third quarter
• Most board members stated that the three main economic sectors contribute to the recovery
• On the production side, most members highlighted the favorable performance of the manufacturing sector
• Most board members pointed out that the balance of risks for the foreseen inflation trajectory remains bias to the upside

The USDMXN has been trading near lows going back to 2020 one

Looking at the weekly chart below, the range between 19.4099 and 19.595 slowed the declines in 2021 and 2022. The last few week, has seen the price trade below that area on the overall USD weakness. If the sellers are to remain in control, staying below that area would give the sellers full control in the short term at least.

The price has been below the 100/200 week MA (blue and green lines) on a closing basis since August (there was one spike above in September that was quickly reversed). Stay below those levels keep the sellers in control longer term.