Societe Generale analysts note that USD/MXN has formed an interim low near 17.10 and is in a short-term rebound within a broad consolidation. The 18.00/18.20 area, aligned with the 200-DMA and January peak, is highlighted as key resistance. A break below 17.44 support would risk resuming the broader downtrend.

Rebound capped by key resistance band

"For Mexico, we pencil in no change at 7.0%. Headline CPI accelerated to 4.63% yoy in first half of March, well above the 3% target of Banxico. Market consensus is for an extended pause until evidence emerges that inflation is converging back to 3%. Inflation forecasts and guidance will be updated."

"USD/MXN established an interim low near 17.10 in February and has since embarked on a short‑term rebound. The 18.00/18.20 zone which corresponds to the January peak and the 200‑DMA, could act as an interim resistance zone."

"So far in March, the pair has evolved within a broad consolidation range. The lower boundary of this range, near 17.44, serves an important support. A break below this may denote risk of extension in the downtrend."

(This article was created with the help of an Artificial Intelligence tool and reviewed by an editor.)