Mexican Peso traces options market clues to pare weekly losses around 17.10

USD/MXN remains on the back foot around 17.10 as it pares the weekly gains after declining in the last two consecutive days. It’s worth noting, however, that the mixed signals from the options market and broad US Dollar strength troubles the Mexican Peso (MXN) traders of late.

That said, the Mexican Peso (MXN) pair dropped in the last week despite the broad US Dollar’s strength as market players sensed more odds of the Fed’s policy pivot than the Banxico. However, the latest firmer US data and yields underpin hawkish hopes from the US central bank and recall the USD/MXN buyers. Even so, today’s Mexican Retail Sales data will be important to watch for clear directions.

The options market data from Reuters prints a different story as the one-month Risk Reversal (RR) of the USD/MXN pair, a measure of the spread between call and put prices, dropped in the last two consecutive days to -0.0100 by the end of Thursday North American trading session.

On the same line, the weekly RR braces for the first negative close in five with the latest prints being -0.035.

Also read: USD/MXN edges lower amid risk-off impulse due to China’s woes