USD/MXN snaps its eight-day losing streak as risk-off sentiment dominates ahead of the scheduled release of US inflation data on Tuesday. The USD/MXN pair trades higher around 16.80 during the European session.The market anticipates a slight increase in February’s US inflation (MoM) figure. A robust US (CPI) data would likely reduce the chances of an immediate rate cut by the Federal Reserve (Fed).Mexico’s includes Industrial Production data for January on Tuesday, with market expectations indicating a monthly increase of 0.4% and a yearly rise of 2.1%. Additionally, market participants are eagerly anticipating the upcoming policy meeting of the Bank of Mexico (Banxico) on March 21.The 12-Month Inflation rate decreased from a seven-month high in January. However, Core Inflation rose higher than the previous increase. Headline Inflation increased less than expected and lower than the previous rise.US Nonfarm Payrolls added more jobs in February compared to January’s figure and market expectations. However, US Average Hourly Earnings (YoY) increased but remained below both the estimated and previous readings.Additionally, Federal Reserve (Fed) Chair Jerome Powell suggested potential cuts in borrowing costs sometime this year, highlighting that such actions would depend on the inflation trajectory aligning with the Fed’s 2% target. According to the CME FedWatch Tool, there has been a slight decline in the probability of a rate cut in June, currently standing at 68.9%. USD/MXN
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