Daily digest market movers: Mexican Peso loses traction on risk aversion
- March’s Building Permits in the US decreased by 4.3%, dipping to 1.458 million, less than the 1.514 million estimates and February’s 1.523 million. Consequently, Housing Starts plunged 14.7%, from 1.549 million to 1.321 million, below forecasts of 1.48 million.
- The Fed revealed that March’s Industrial Production was aligned with estimates and the previous reading of 0.4% MoM.
- Despite posting mixed data, traders continue to digest the strong March US Retail Sales report revealed on Monday. This report was highlighted by the behavior displayed by the control group—used to calculate the GDP—crushing estimates and the previous month's reading.
- Retail Sales in the control group jumped from 0.3% in February to 1.1% MoM in March, surpassing forecasts of a 0.4% expansion.
- Geopolitical tensions in the Middle East would likely weigh on the Mexican currency. USD/MXN traders must be aware that any escalation could prompt traders to ditch the Mexican Peso and buy US Dollars.
- US Treasury yields surged more than 10 basis points (bps) in the belly and long end of the yield curve. That underpins the Greenback, which is up a modest 0.09% at 106.17 on the DXY.
- Data from the Chicago Board of Trade (CBOT) suggests that traders expect the fed funds rate to finish 2024 at 4.97%.
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