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The Mexican Peso Strengthens as Does Asia This Morning

By:
David Frank
Updated: Oct 20, 2016, 09:36 UTC

The Mexican peso strengthened against the US Dollar overnight after the final presidential debate. This morning, in late morning trade, most of the Asian

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The Mexican peso strengthened against the US Dollar overnight after the final presidential debate. This morning, in late morning trade, most of the Asian markets were also higher.

Overnight, the Mexican peso, which is a barometer in the US election cycle, rose to $18.44 against the Dollar and currently is trading at $18.56. It was near $18.51 before the start of the debate. Earlier this week the peso was over $19. The peso recovering is a sign that traders think Trump has lost yet another debate.

The US presidential nominee, Hillary Clinton (D) and Donald Trump (R) debated on a range of topics from Supreme Court nominees to Russian involvement in the hacks to immigration. The debate was hosted by Chris Wallace.

Aside from the debate there was little data during the session this morning. In Australia, the employment numbers came in lower than expected. The Australian Bureau of Statistics showed that their economy contracted by 9,800. This means it lost 9,800 jobs. Economists expected a positive print of 15,000. Full time employment fell while part time rose. The unemployment rate fell 0.1 percent to 5.6 percent as the labor force participation decreased.

This could lead the Reserve Bank of Australia to consider a rate cut at their November meeting, but this number is not enough to guarantee an RBA rate cut. This was a poorer number, but things can get more interesting after The Down Under releases its third quarter inflation numbers. This is due early next week, and if it comes in weak, would be more of a policy mover for their central bank.

After the employment data was released, the AUD/USD Forex market reversed lower. The Australian Dollar went from a session high of $0.7734 to a low of $0.7665.

However, stocks on their headline stock bourse, the S&P ASX 200 traded higher on the day. There were gains in both the energy and materials sub-sectors. Both were up over 1.1 percent by 1130 am HK time.

This morning, other Asian markets were also mostly higher. The headline Nikkei 225, in Japan rose 1.13 percent while the Topix, in Tokyo, rose 0.8 percent. Across the Korean Strait, the Kospi Composite Index closed flat on the day. In Hong Kong, the Hang Seng Index rose 0.6 percent.

In mainland China, their stock bourses saw a mixed day. The Shanghai Composite Index lost 0.1 percent and the Shenzhen Composite rose 0.16 percent on the day.

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