Mexican Peso Weakens Following U.S. Tariff Delay
On the domestic front, investors are awaiting the release of the minutes from the Bank of Mexico’s latest monetary policy meeting.
Quick overview
- The Mexican peso weakened against the dollar, closing at 18.6435 pesos per dollar, a slight depreciation of 0.07%.
- The U.S. extended the tariff deadline from July 9 to August 1, leading to increased demand for the dollar.
- President Trump warned of additional tariffs on countries aligning with BRICS, escalating trade tensions.
- Investors are awaiting the Bank of Mexico's meeting minutes and inflation report to gauge the central bank's response to external volatility.
The Mexican peso edged lower against the dollar in Monday’s session, weakening as the greenback strengthened following the U.S. decision to delay the implementation of new tariffs initially set for July 9.
The exchange rate closed at 18.6435 pesos per dollar, compared to 18.6297 pesos in the previous session, according to data from Mexico’s central bank (Banxico). This represents a depreciation of 1.38 centavos, or 0.07%, for the local currency.
During the day, the dollar traded within a range of 18.7705 (high) and 18.6045 (low). The U.S. Dollar Index (DXY)—which tracks the greenback against six major currencies—rose 0.39% to 97.56.
Tariff Deadline Extended
The White House announced Monday that the tariff deadline would be extended from July 9 to August 1. U.S. Treasury Secretary Scott Bessent said several trade-related announcements would follow within the next 48 hours.
According to Bessent, tariffs on countries failing to reach agreements would rise to the levels originally announced by President Donald Trump on April 2—before the administration suspended them to allow for negotiations and a 90-day grace period.
Following the announcement of the deadline shift, markets saw a notable uptick in the dollar index, reflecting renewed demand for the U.S. currency.
Trump Escalates Rhetoric Against BRICS
Investors also reacted to fresh comments from President Trump, who warned that countries aligning themselves with the “anti-American policies” of the BRICS bloc would face an additional 10% tariff. The BRICS countries (Brazil, Russia, India, China, and South Africa) have expressed concern over the growing use of unilateral trade measures that distort global commerce.
Focus on Banxico Minutes
On the domestic front, investors are awaiting the release of the minutes from the Bank of Mexico’s latest monetary policy meeting. In that meeting, Banxico’s board cut interest rates by 50 basis points to 8%—its fourth consecutive cut of that magnitude.
“Traders will be closely watching this week’s inflation report and Banxico’s meeting minutes to assess the central bank’s stance amid persistent external volatility,” said Quásar Elizundia, analyst at Pepperstone.
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