Skip to content Mexican Peso Hits 6-Week Low Amid Tariff Threats
In October, the Mexican peso fell to 20 per USD, reaching a six-week low due to external and internal challenges. This led to a wider demand for more flexible lending conditions.
The below USD/MXN 4-hour price chart demonstrates the price, support, and resistance levels.
Bank of Mexico Signals Rate Cuts in 2025
The situation worsened with former US President Donald Trump’s threat to heavily tax Mexican cars by up to 300%, especially as his chances of election success seemed to increase. This poses a significant threat to Mexico’s important car industry. Additionally, an IMF report suggested that Mexico’s economic growth would slow to 1.5% this year, even with extra government spending.
However, the report also highlighted some potential advantages of nearshoring and expected a decrease in inflation by 2025. Bank of Mexico meeting notes showed a readiness to ease monetary policy, with experts anticipating a reduction in interest rates by 50 basis points throughout the year.
US Tightens Policy
Expectations of tighter monetary policy in the US have made emerging market investments less attractive, leading to cautious attitudes towards these markets despite small stimulus efforts from China.
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