He The Mexican peso depreciated by more than 1% on Tuesday after President Donald Trump threatened to impose 25% tariffs on imports from Mexico and Canada starting Feb. 1.
The local currency was trading at 20.75 per dollar, although it had earlier weakened to an intraday low of 20.79, hovering very close to the 20.94 level reached on January 17, which was its worst level since July 2022.
The peso, a thermometer of emerging market sentiment, has been heavily impacted by the policies proposed by the newly inaugurated US president, especially his plans for trade tariffs.
“Trump seems to have delayed the tariffs (…) but in some ways Mexico and Canada are the exception, which I think is very strange for the market because when he started his election campaign, China was the most obvious target,” – Michael Pfister said. Currency exchange analyst at Commerzbank.
He added that since other countries are currently excluded from tariff threats, the two countries that will be affected will suffer the most.
The Canadian dollar lost about 1%, trading at 1.44.
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Before taking office, Trump said he might introduce tariffs 10% on global imports and 60% on Chinese products, as well as 25% on imports from Canada and Mexico.
Weight, which until recently was one of world currencies more stable against the dollar, has been under intense pressure in recent months, including due to Mexico’s presidential elections in June and a series of constitutional changes that followed.
“It appears that at this point the market, at least as far as the Mexican peso is concerned, is somewhat comfortable with the level that we’re seeing,” Pfister said.
Reuters
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.