The USD/MXN pair continues its upward momentum for the second consecutive session, trading around 20.70 during Asian hours on Friday
Mexican Peso (MXN) under pressure
The USD/MXN pair has been on the rise for the second day in a row, with the Mexican Peso (MXN) continuing to struggle against the US Dollar. This recent surge in the USD/MXN pair can be attributed to renewed tariff threats from US President Donald Trump. The Mexican economy is already facing challenges due to the ongoing Covid-19 pandemic, and the prospect of additional tariffs is adding further pressure on the Mexican Peso.
Impact on Mexico
The renewed tariff threats from President Trump have put Mexico in a difficult position. The Mexican government is already struggling to contain the spread of the virus and mitigate its economic impact. The imposition of tariffs would further exacerbate the situation, leading to higher prices for Mexican goods and potentially causing a decline in exports to the US. This could have a detrimental impact on the Mexican economy, leading to job losses and decreased consumer confidence.
Impact on the World
The uncertainty surrounding the US-Mexico trade relations is not only a concern for Mexico, but also for the global economy. Mexico is a key trading partner for many countries around the world, and any disruption in trade between the US and Mexico could have ripple effects on other economies. The potential imposition of tariffs could lead to a trade war between the two countries, further destabilizing global markets at a time when many economies are already reeling from the effects of the pandemic.
Conclusion
It is clear that the renewed tariff threats from US President Donald Trump are putting pressure on the Mexican Peso and creating uncertainty for both Mexico and the world. The implications of a potential trade war between the US and Mexico are significant, and could have far-reaching consequences for the global economy. It is essential for both countries to find a resolution that protects the interests of all parties involved and avoids further economic turmoil.
