- USD/MXN register gains after the weekly gap-up opening.
- Mexico City hospitals near full capacity, turning patients.
- US death toll cross 40,000, President Trump awaits details of a deal for the second stimulus package.
- WTI remains under pressure as demand-supply matrix dwindles.
Following its gap-up opening to 23.89, USD/MXN takes the bids to 24.08 during Monday’s Asian session. In addition to the renewed of the coronavirus (COVID-19) outbreak in Mexico, weak oil prices also exert downside pressure on the Mexican peso (MXN).
During late-Sunday, Bloomberg came out with the news suggesting that Mexico City hospital is at full capacity. The report relies on the comments from Mayor Claudia Sheinbaum, who appeared in newspaper El Norte, while stating, “hospitals in Mexico City are nearing saturation point after they received 100 more COVID-19 patients requiring intubation in just two days. The General Hospital there is at capacity and is turning away patients.”
Out of nearly 7,500 cases of the country, Mexico City registered 2,299 cases and 178 deaths, from a total of 650, as per the news piece.
Other than the virus outbreak, weakness in the oil prices also weighs on the pair. WTI remains near multi-year low as traders fear less demand due to the virus weighing on the economic activities. Further to weaken the energy prices, the global oil producers’ latest output cut of 9.7 million barrels a day is considered less than earlier estimated.
Elsewhere, the US death toll surges past-40,000 with 744,000 cases making it the global hotspot. US President Donald Trump keeps pushing for the economic restart while also expecting a decision on the deal to second aid package on Monday.
Market’s risk-tone remains heavy with the US 10-year Treasury yields declining to 0.648% and Japan’s NIKKEI down 0.80% to 19,725 by the press time.
Given the coronavirus outbreak weighing the global economy, a lack of major data/events could keep virus updates on the driver’s seat.
Technical analysis
Sustained break of 10-day SMA pushes the pair to question the last week’s top of 24.43 ahead of diverting the bulls to the monthly high surrounding 25.80. Alternatively, a three-week-old rising trend line, at 23.51 now, could add downside filters to the pair below a 10-day SMA level of 23.80.
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