Mexico's Peso Plummets Amid Tariff Threats

Mexico's peso fell over 1% against the dollar following President Trump's tariff threats on Mexico and Canada. The peso, already weakened by 20% over the past year, reflects emerging market sentiment. The Canadian dollar also dipped, highlighting potential trade vulnerabilities.

Mexico's peso experienced a decline of more than 1% against the U.S. dollar on Tuesday, triggered by President Donald Trump's announcement of a potential 25% tariff on goods from Mexico and Canada set to be imposed on February 1.

The currency, often seen as an indicator of emerging market confidence, has been significantly affected by Trump's proposed trade policies, which prioritize tariffs. Amid expectations, only Mexico and Canada currently face threats, deviating from the initial focus on China during Trump's campaign.

While Mexico's currency has lost nearly 20% of its value over the last year, largely due to domestic political events, it remains steadfast at the current level, providing some stability against market anxieties.

(With inputs from agencies.)