During 2023 Mexican Peso reached historically low levels against the US dollar. In mid-July, its exchange rate reached 16.74 to the dollar, its highest rate in 23 years. Its strength has prompted economists and financial experts to call it superheavy.
Experts from National Autonomous University of Mexico (UNAM) explained that the appreciation of the Mexican currency against the US currency is due to many factors, including increase in oil exports due to various political conflicts such as the conflict between Russia and Ukraine.
They also attribute this to increased global demand for this fuel due to economic recovery, as well as dollar weakening against the euro and other currencies, as well as growth in national industrial exports and a significant influx of remittances into the country.
Although he super heavyweight has a very positive impact on the economy, especially for companies that import resources from other countries, experts from the Institute of Economic Research (IIEc) UNAM agreed that there are factors such as the behavior of remittances or rising interest rates this may have an impact in the medium to long term.
“Perhaps this really affects reduce inflation The appreciation of the peso will be gradual, but I believe it will also impact the agricultural sector, manufacturing sector and automobile sector. But first of all, this is not something immediate,” said researcher Eufemia Basilio Morales during a press conference held in March this year.
Basilio clarified that to what has been said is added the fact that when Money transfers In pesos, its value is lower, meaning that although the amount of money sent into the country from abroad increases, there is little income when converting it into Mexican currency.
For this reason, researcher José Manuel Márquez Estrada explains that “the existence of a superweight with which a superweight exists is not synonymous.” better conditions for the economy”
“It is not a sustainable question, nor is it whether the average exchange rate is at this level or whether the peso is becoming much more expensive. This would no longer be so desirable; it would lead to higher prices. export Mexicans, this will also hurt investments, etc.,” he stressed.
Source: Aristegui Noticias
Roy Brown is a renowned economist and author at The Nation View. He has a deep understanding of the global economy and its intricacies. He writes about a wide range of economic topics, including monetary policy, fiscal policy, international trade, and labor markets.
