A further fall in the price of the Mexican peso Thursday has left market participants cautious on where the currency could be heading next, with new policy announcements by the Trump administration adding to a high level of political uncertainty.
"We see MXN (the Mexican peso) at 20-21 (per dollar) throughout the year. While we still see a possibility of MXN trading at 25-28, we now think there are too many uncertainties to have a strong conviction about strong depreciation or appreciation," Nomura said in a note on Friday.
"Mexico is one of the EM (emerging market) countries most exposed to the Trump administration's likely protectionist policies," Nomura added.
Quote: In avocado country, Mexicans not afraid of Trump tariff threats
Economy37 minutes ago (Feb 02, 2017 02:30PM ET)
By Adriana Barrera
URUAPAN, Mexico (Reuters) - Avocado farmers in the rolling hillsides of Mexico's Michoacan state are not worried for now by U.S. President Donald Trump's threats to tear up a trade deal which could make the favorite snack of Super Bowl viewers more expensive. Americans will chomp through huge amounts of avocados mashed into guacamole during the Super Bowl on Sunday, and 80 percent of those fruits will come from Mexico’s ever-larger expanse of orchards, thanks to a free market created by the North American Free Trade Agreement in 1994. It is peak season for guacamole, a word that means avocado sauce in Mexico's native Nahuatl language. Some 100,000 tonnes of the green fruit, or 12 percent of annual U.S. demand, will be consumed on Sunday and in the days before and after the New England Patriots game against the Atlanta Falcons, exporters say. With such market dominance and demand, growers like Adrian Iturbide doubt Trump's eagerness to impose duties on Mexican goods will dent exports. They feel they have little to fear from proposals by the Republican such as a 20 percent blanket tariff on U.S. imports from Mexico, that would affect sales of "green gold" to the northern neighbor.
Februar 02 2017: U.S. Retailers starts to fight back.
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