MXN lining up a bullish flag with a target of $32 MXN per 1 USD.
I posted an idea on July 22, 2019 with my target at $29 pesos per 1 USD by August 2020. However, the new Mexican Government's poor economic choices along with the with the rise of the COVID-19 pandemic, have exacerbated the problem and consequently accelerate the peso's fall. Banxico has been intervening by selling USD in the open market in an effort to stopping the pesos fall. Consequently, how much of an intervention is Mexico's central bank able to afford? only time will tell.
Things don't look so promising though.
AMLO has cancelled an important contract with constellation brands after an initial investment was made.
Foreign investment is declining due to loss of confidence.
The cancellation of the lease of the presidential plane has not been done due to lack of funds.
Investments in the unprofitable and state run oil company PEMEX, the Dos Bocas refinery, and the Santa Lucia Airport, the creation of the national guard, plus numerous social programs are draining the economy heavily. In addition, a drop in GDP due to investor confidence, COVID-19, and poor economic choices do not paint a positive outlook for the peso and the overall Mexican economy.
Things don't look so promising though.
AMLO has cancelled an important contract with constellation brands after an initial investment was made.
Foreign investment is declining due to loss of confidence.
The cancellation of the lease of the presidential plane has not been done due to lack of funds.
Investments in the unprofitable and state run oil company PEMEX, the Dos Bocas refinery, and the Santa Lucia Airport, the creation of the national guard, plus numerous social programs are draining the economy heavily. In addition, a drop in GDP due to investor confidence, COVID-19, and poor economic choices do not paint a positive outlook for the peso and the overall Mexican economy.