Peso Plunges Amid U.S. Election Tensions

The Mexican peso weakened sharply against the U.S. dollar as results from the U.S. presidential election began to emerge. Concerns over potential tariffs under a Trump presidency contributed to the peso's volatility. Outcomes of the U.S. election remain uncertain, influencing further currency fluctuations.

The Mexican peso experienced a sharp decline against the U.S. dollar during Tuesday evening's international trading session, coinciding with the early results of the U.S. presidential election. The currency, which was trading as high as 20.3920 per dollar, marked its weakest point since September 2022, falling nearly 1.5% from its earlier closing price.

Amidst vote counts, traders are preparing for more instability fueled by the prospect of a Republican Donald Trump victory over Democratic contender Kamala Harris. Trump's pledge to impose new tariffs on Mexican exports has added to the peso's vulnerabilities.

If Trump emerges victorious, analysts predict the peso could devalue further, reaching approximately 20.50 per dollar. Conversely, a win for Harris could see the peso strengthen to around 19 per dollar. Experts warn of heightened volatility should the election results become contested, affecting market sentiment.

(With inputs from agencies.)