Mexican Peso Falls Amid New Threats from Trump
The Mexican peso weakened at the start of the week, pressured by a new tariff threat from U.S. President Donald Trump, who is seeking to impose duties on all steel and aluminum exports to the United States.
The exchange rate closed at 20.5979 pesos per dollar, down from 20.5450 on Friday, according to data from the Bank of Mexico (Banxico). This represents a depreciation of 5.29 cents, or 0.26% for the peso.
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The dollar traded within a range, reaching a high of 20.7011 and a low of 20.5517 pesos. Meanwhile, the U.S. Dollar Index (DXY), which measures the dollar against a basket of six major currencies, rose 0.28% to 108.34.
Markets Await Clarity on Tariffs
The USD/MXN exchange rate remains stuck around 20.63, as markets await further details on the potential tariffs. Trump did not provide specifics in his Sunday remarks but stated he would announce new trade measures today.
When asked about the issue, Mexican President Claudia Sheinbaum Pardo urged calm: “Let’s wait and see if (Trump) announces anything, and from there, we will make our decisions,” she stated in her daily press briefing.
Tariff Expected Impact
A 25% tariff on steel and aluminum would have a significant impact on Mexico, as 82% of its metal and manufacturing exports go to the United States. CiBanco analysts forecast the peso trading within a 20.30 to 20.80 range this week.
Last week, Sheinbaum reached an agreement with Trump to delay the tariff imposition for one month. The initial tariff threats had pushed the peso to its weakest levels in nearly three years.
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