Mexican Peso Gains Against the Dollar Ahead of Steel Tariffs
The Mexican peso appreciated against the dollar on Tuesday, advancing in a wait-and-see session as investors remained focused on news about U.S. President Donald Trump, who was set to meet with 100 business leaders.
The exchange rate closed at 20.2582 pesos per dollar, improving from Monday’s close of 20.3623, according to official data from the Bank of Mexico (Banxico). This represented a gain of 10.41 cents, or 0.5%, for the peso.
During the session, the dollar traded within a range, reaching a high of 20.4039 pesos and a low of 20.2465 pesos. Meanwhile, the U.S. Dollar Index (DXY), which measures the dollar against a basket of six major currencies, fell 0.49% to 103.42 points.
Market Caution Over Trump
Trump, whose trade policies have unsettled markets, was set to meet with the Business Roundtable in Washington, a group representing CEOs of the 100 largest U.S. companies. His proposed tariffs were expected to be a key topic of discussion.
Trump’s 25% tariffs on steel and aluminum are scheduled to take effect tomorrow, following a last-minute decision last Thursday to delay tariffs on certain products covered under agreements with Mexico and Canada until April 2.
Additionally, on Tuesday, Trump threatened to dismantle Canada’s auto industry unless the country removed tariffs on electricity and certain agricultural goods imported from the U.S. Unlike Mexico, Canada has taken a less conciliatory stance on these new trade policies.
Mark Carney, the leader of Canada’s Liberal Party and the country’s incoming Prime Minister, recently stated that Canada would maintain its trade countermeasures “until the U.S. shows respect.” His remarks have contributed to the cautious sentiment among market participants.
Weaker Dollar Amid Economic Concerns
Analysts have pointed out that Trump’s tariff policies could impact the U.S. economy, potentially leading to higher prices and even a slowdown. The dollar has fallen nearly 4% against major currencies in March.
Over the weekend, Trump raised further concerns in an interview when he refused to answer whether a U.S. recession was imminent, stating only that the country was in a transition period toward “something big.”
Meanwhile, Federal Reserve Chairman Jerome Powell said at a forum in New York on Sunday that the Fed would need to wait and assess the impact of Trump’s new policies. On Thursday, U.S. inflation data is expected to be released, which could provide further insight into economic conditions.
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