Reuters
- The Mexican peso fell as much as 3.58% after President Donald Trump announced plans to slap tariffs of up to 25% on Mexican goods unless the "illegal immigration problem is remedied.
- The US accounts of 80% of Mexico’s exports.
- Watch the Mexican peso trade live.
The Mexican peso is getting whacked on Friday, down more than 2.4% at 19.6373 per dollar, after President Donald Trump announced plans to slap tariffs of up to 25% on goods coming into the United States from Mexico. At its low, the peso was down more than 3.5%.
"On June 10th, the United States will impose a 5% Tariff on all goods coming into our Country from Mexico, until such time as illegal migrants coming through Mexico, and into our Country, STOP," Trump tweeted on Thursday evening. The tariffs will gradually increase to 25% by October and remain in place until the "Illegal Immigration problem is remedied," the president added.
Trump’s announcement hit the peso hard as the United States is Mexico’s largest trading partner, receiving 80% of the country’s exports, according to the CIA World Factbook.
Most of the activity between the two countries, about 67% of US imports, comes in the form of intra-company trade, according to Deutsche Bank Chief Economist Torsten Sløk. "Trade with Mexico is basically all about the supply chain, which essentially is all about cars," he wrote.
The Mexican peso is unchanged this year, including Friday’s drop.
Markets Insider
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Source: Business Insider – jgarber@businessinsider.com (Jonathan Garber)