FX.co ★ Mexican Peso Strengthened to 20.1 per USD

The Mexican peso has appreciated back toward 20.1 per dollar, recovering from its lowest point of 20.85 on April 8th— a level not seen since March 2022. This movement is largely attributed to a significant weakening of the U.S. dollar, which has slumped to its weakest position since 2022. The decline follows China's robust response to U.S. tariffs, imposing a 125% duty on American goods. This action sparked a widespread selloff of the dollar as investors reconsidered the potential repercussions for the U.S. economy and anticipated prolonged trade disruptions. Nevertheless, market stability was partially restored after the Trump administration opted to temporarily exempt certain Chinese tech products from tariffs, alleviating concerns of an immediate U.S. recession. This decision has helped bolster risk sentiment and revived hopes for continued demand in export-oriented countries like Mexico. As a major supplier to both U.S. manufacturing and consumer sectors, Mexico is well-positioned to benefit from any resurgence in U.S. demand, enhancing the attractiveness of the peso.