The exchange rate closed this Monday at 20.75 pesos per dollar, according to the Bank of Mexico. The concern in recent days is not related to the progress in the reform of the Judiciary or other reforms from the previous administration, as the market had anticipated them. The volatility in the foreign exchange market is due to the proximity of the elections in the United States and the tight competition between candidates Kamala Harris and Donald Trump.
In a report, analysts from Banorte mention that, just a few days before the elections, the preferences show a technical tie between the candidates, but Kamala is slightly leading nationally. Experts are surprised that Trump's advantage has increased significantly in recent weeks, reaching its historical maximum. In the betting market, the possibility of a Trump victory and total control of Congress is favored, which increases the risk of implementing radical policies.
As the elections in the U.S. approach, market attention shifts away from local issues to focus on the elections, contributing to the weakness of the peso against the dollar. Trump's aggressive tariff proposals could affect the growth of the Mexican economy and reduce the benefits of nearshoring in the country, according to analysts from Monex Financial Group. In this context, at the beginning of the week, the exchange rate was again around 20 units per dollar.
