Topic: Mexico MEX interest Rate May 13 2021
What does the data mean to the market?
Mexico's central bank vote on where to set the countries interest rate.
Traders watch interest rate changes closely as interest rates are the primary factor in currency valuation.
A higher than expected rate is positive/bullish for the MXN (Mexican Peso), while a lower than expected rate is negative/bearish for the MXN.
Historic deviations and their outcome
November 12 2020 We saw an increase of +18 basis point (bps) from the average forecast, which created a massive 546 pip move in the first minute following the data release, that's an average of 30 pips per basis point. Astonishing move!
See Chart here:
August 15 2019 We saw a cut of -25 basis point (bps) from the average forecast, resulting in a move of 831 pips which was a lovely move!
See Chart here:
I will use forecasts of:
Interest Rate 4
Today's trade plan
I will be looking for a deviation of 0.25 in either direction from the forecast, which should result in another very tradeable move.
Hope this helps but please do your own analysis!!
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