The Mexican peso weakened Wednesday to fresh lows against the U.S. dollar ahead of President-elect Donald Trump’s highly anticipated news conference.
“Most of what’s driving the peso today is [still] policy, what you might hear [at] the Trump press conference,” said Jason Leinwand, founder and CEO of currency trading advisory firm FirstLine FX.
“There’s still a lot of concern in markets about the U.S.-Mexico relationship going forward, a lot of concern about NAFTA,” the North American Free Trade Agreement, Leinwand said. He said weakness in the peso should continue despite the Mexican central bank’s intervention efforts and expected interest rate hikes.
The dollar-peso hit 21.9477 in early morning trade, extending as the Mexican currency extended Tuesday’s more than 1.5 percent decline.
The peso has fallen more than 5 percent against the dollar to start the year, and is off nearly 20 percent since the election. Traders are concerned Trump’s tough campaign talk against Mexico, including renegotiation of NAFTA, will become reality after his inauguration. The president-elect is scheduled to speak at his first news conference since the election at 11 a.m., ET.
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