Mexican Peso Drops 3% This Week Amid Trump Effect

The Mexican peso closed Friday’s session nearly flat but ended the week with a sharp 3.1% decline, pressured by fears over the potential return of Donald Trump to the U.S. presidency.

The exchange rate settled at 19.8860 pesos per U.S. dollar, showing a minimal daily movement from Thursday’s 19.8807, according to official data from the Bank of Mexico (Banxico). This marginal change of just 0.03%—less than one cent—reflected the day’s stability.

During the session, the dollar fluctuated between a high of 19.9120 pesos and a low of 19.6505 pesos. Meanwhile, the U.S. Dollar Index (DXY), which measures the greenback against six major currencies, dropped 0.35% to 103.46 points.

After breaking a three-day losing streak on Thursday, market sentiment toward the peso once again turned cautious, driven by the fast-approaching U.S. presidential election on November 5. Trump’s recent comments—singling out Mexico as a policy focus—have heightened market jitters, with the peso briefly crossing the 20-peso-per-dollar mark on Thursday, its highest level since September.

Compared to last week’s closing rate of 19.2870 pesos per dollar, the currency weakened by 59.9 cents, equating to a 3.1% decline. This slump occurred despite earlier support from positive economic data and news from China.

The peso initially tracked regional currency gains following comments by Federal Reserve officials, who emphasized that interest rates would fall gradually to prevent inflation from remaining above target.

From a technical standpoint, analysts from Intercam Casa de Bolsa noted that the peso broke through resistance at 19.77 pesos and extended toward 19.82, after briefly testing support near 19.6200. The currency’s recent movements suggest a depreciation trend, with projections pointing to a possible range between 20.15 and 20.22 pesos per dollar, though resistance at 19.97 could slow further losses.