Mexican Peso Falls After 25% Tariff Confirmation
The local currency reacted to comments made by U.S. President Donald Trump to the press, in which he reiterated his plan to impose 25% tariffs on imports from Canada and Mexico.
The peso closed Thursday at 20.4273 per dollar, compared to 20.5370 per dollar on Wednesday, according to official data from Mexico’s central bank (Banxico). This represented an appreciation of 10.97 cents, or 0.53%.
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However, in electronic trading shortly after Banxico’s official closing, the peso depreciated by 1.43%, trading at 20.7196 per dollar.
Tariff Confirmation
Trump, speaking to reporters at the White House, stated that the tariffs would be announced for various reasons, including fentanyl concerns. He added that the first set of tariffs would take effect this Saturday, without providing further details.
The justifications were the following: “These tariffs on Canada and Mexico will be announced for several reasons. The first is the massive and terrible way people have been entering our country. The second is drugs—fentanyl and everything else that has come in. And the third is the massive subsidies we are giving to Canada and Mexico in the form of deficits,” Trump told reporters at the White House.
Against this backdrop, the Mexican peso and the Canadian dollar were the worst-performing currencies against the U.S. dollar on Thursday.
Emerging Market Currencies
The Canadian dollar lost 0.59%, the Indonesian rupiah depreciated by 0.54%, the Swedish krona fell 0.48%, and the New Zealand dollar weakened by 0.39%.
On the other hand, the best-performing currencies were the Russian ruble (+0.88%), the Chilean peso (+0.77%), the Israeli shekel (+0.53%), and the Japanese yen (+0.53%).
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