USD/MXN Forecast: Dollar-Peso Probes Key Level as Oil Swings

There are some big swings in the US Dollar-MEX Forecast: Dollar-Peso Probes at Key Level as Oil Swings Continue. The Dollar has already been able to withstand the loss of China’s export revenue, but with the US Dollar remains relatively strong and stable, the impact of the loss may be more limited.

USD/MXN Forecast: Dollar-Peso Probes at Key Level as Oil Swings Continue: The USD/MXN Forecast: Dollar-Peso Probes at Key Level as Oil Swings Continue: “In the wake of a meeting between the Federal Reserve and the Chinese leadership, investors have been concerned that China may start to lose its grip on oil exports, which is important for the US dollar. In addition, it seems that the two nations are getting closer to trade negotiations for Chinese trade in Central Asia, which will also be helpful for the US dollar. On the other hand, the USD/MXN Forecast: Dollar-Peso Probes at Key Level as Oil Swings Continue: “US dollar depreciation may affect oil exporters in the future, especially those which rely on China, but for now, the trade balance shows that China still accounts for almost a quarter of US merchandise exports.”

USD/MXN Forecast: Dollar-Peso Probes at Key Level as Oil Swings Continue: “Oil exporters in the Middle East have been affected by the recent economic slowdown, with oil prices hitting a record low of over $26 a barrel last week and falling further since then. This is bad news for exporters in the Middle East who rely on Chinese imports in order to make their economies sustainable.

USD/MXN Forecast: Dollar-Peso Probes at Key Level as Oil Swings Continue: “For now, the trade deficit shows that the Chinese trade deficit remains about the same as it was before the current slowdown, meaning that trade deficits can’t be explained by any change in the trade balance itself. However, it does imply that China’s trade deficit can’t be solely explained by its current economic slowdown, because trade flows tend to follow economic changes in the global markets.”

USD/MXN Forecast: Dollar-Peso Probes at Key Level as Oil Swings Continue: “The Eurozone economy is beginning to recover, but the euro has recently dropped below the psychological level of US dollar strength. This may not be good news for European traders and investors. The Eurozone’s recovery, however, may not be too positive for oil exporters, who depend on Chinese imports for a large part of their income.

USD/MXN Forecast: Dollar-Peso Probes at Key Level as Oil Swings Continue: “The euro is now trading well below the levels required for a break of the USD/EUR, although this may not be enough to prevent it falling below the level of USD strength required to support the EUR. The EUR is also becoming vulnerable to a possible reversal in the trade balance after oil exporters in the Middle East have been affected by recent weakness in the US Dollar and China’s trade deficit.”

USD/MXN Forecast: Dollar-Peso Probes at Key Level as Oil Swings Continue: “It is clear that oil exporters that are dependent on the US dollar may face problems in the coming months. The USD/MXN Forecast: Dollar-Peso Probes at Key Level as Oil Swings Continue: “The US dollar may be able to withstand a slight reduction in the trade deficit, but a major correction may happen much quicker if the dollar falls too far below the level of USD strength needed to support the EUR and other trade currencies. Therefore, a break of the USD/USD Forecast should be watched closely.”

There is no doubt that we will see a number of currency trade forecasts in the coming months. But we should remember that these predictions are mostly based on assumptions and should not be taken as the final word.

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