Mexican Peso Falls for Fourth Straight Session, Closes Week in the Red
The Mexican peso depreciated on Friday as the market prepared for the implementation of new tariffs imposed by U.S. President Donald Trump next week.
The local currency weakened against the U.S. dollar for the fourth consecutive session. The exchange rate closed at 20.4169 pesos per dollar, compared to Thursday’s official close of 20.3044 pesos, according to data from Banco de México (Banxico). This represented a loss of 11.25 cents, or 0.55%, for the peso.
Throughout the session, the dollar fluctuated between a high of 20.4570 pesos and a low of 20.2689 pesos. Meanwhile, the U.S. Dollar Index (DXY), which measures the dollar against a basket of six major currencies, edged down 0.28% to 103.97 points.
Market Concerns Over Trump’s Tariffs
Traders are bracing for the upcoming implementation of the new U.S. tariffs, with particular concern over a 25% tariff on all automobiles not manufactured in the United States.
According to INEGI data, Mexico exported 3.48 million light vehicles in 2024, with 79.7% (approximately 2.77 million units) destined for the U.S. market. Investors are closely watching the potential impact of these tariffs on trade and economic stability.
Mexican President Claudia Sheinbaum Pardo stated this week that Mexico will respond to the tariffs on April 3 if they take effect. However, Trump has assured that vehicles meeting the requirements of the USMCA trade agreement will be exempt.
Markets are also focused on Trump’s April 2 announcement, where he is expected to introduce reciprocal tariffs on all U.S. trading partners.
Weekly Decline for the Peso
In this context, the four-day losing streak led the peso to end the week in negative territory. Compared to last Friday’s exchange rate of 20.2405 pesos per dollar, the currency depreciated by 17.64 cents, or 0.87%.
The peso’s losses come amid growing risk aversion and Banxico’s recent decision to cut its benchmark interest rate by 50 basis points to 9.0%, reducing the appeal of local assets.
The surprise came from Banxico’s dovish tone, as policymakers did not rule out further cuts of the same magnitude in future meetings. This signals concerns over economic weakness and external challenges.
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