Categories: Forex News

Mexican peso posts largest annual drop versus US greenback in 16 years


MEXICO CITY (Reuters) – Mexico’s peso weakened practically 23% this 12 months to shut the ultimate day of buying and selling at 20.82 pesos per U.S. greenback on Tuesday, the foreign money’s deepest drop towards the dollar because the 2008 world monetary disaster.

The peso’s unstable 12 months kicked off with months of regular beneficial properties till the times following June’s basic election, which swept the leftist coalition led by the ruling Morena social gathering to a powerful victory within the presidential race in addition to giant congressional majorities.

Forward of the election, the Mexican foreign money traded in April at about 16.26 pesos per greenback to succeed in a nine-year excessive.

The election win for Morena paved the way in which for passage of constitutional reforms in September, together with a serious overhaul of the judiciary that critics argue will undermine the independence of the courts in Latin America’s second-biggest financial system.

The election of U.S. President-elect Donald Trump in November exacerbated the peso’s rocky journey, amid his recent tariff threats towards Mexico, which sends round 80% of its exports to its northern neighbor.

Mexico’s important inventory index additionally shed worth in the course of the 12 months, dipping practically 14% to shut on Tuesday at 49,513 factors, its steepest fall since 2018.

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