Ahead of Friday's US Nonfarm Payrolls, USD/MXN is down.
Mexico was given a 90-day respite by President Trump from the proposed 30% increase in tariffs on a number of items.
The PCE report suggested that the Fed might postpone rate reduction until at least October, which caused the US dollar to rise.
After recording increases for the last five days in a row, the USD/MXN is now trading at about 18.90 on Friday during Asian hours. The pair is struggling as the Mexican Peso (MXN) may improve after US President Donald Trump decided to give Mexico a 90-day respite from increased tariffs of 30% on a number of items in order to give them more time to negotiate a more comprehensive trade agreement.
In accordance with the US-Mexico-Canada Trade Agreement, the US spared Mexico's non-automotive and non-metal imports from a 30% duty. Following a phone conversation between Trump and Mexican President Claudia Sheinbaum on Thursday, this decision was made. "We dodged the tariff rise announced for tomorrow," Sheinbaum wrote in a Thursday post on X, adding that the Trump call was "really nice," according to Reuters. Trump also claimed on Truth Social that Mexico has committed to removing its non-tariff trade barriers right now.
But the United States would still impose a 50% tax on copper, aluminum, and steel from Mexico. Mexican automobiles and non-USMCA-compliant commodities will continue to be subject to a 25% tariff. Measures pertaining to the US fentanyl crisis are linked to these tariffs.
Higher tariff rates imposed by President Trump on US trading partners will take effect on August 1. In order to avoid missing the deadline for trade agreements, Trump issued an executive order on Thursday that imposed duties ranging from 10% to 41% on US imports from dozens of nations and overseas sites, including Canada, India, and Taiwan, according to Reuters.
The recent US Personal Consumption Expenditure (PCE) Price Index report indicated that price pressures would increase in the second half of 2025 and postpone the US Federal Reserve's (Fed) interest rate cuts until at least October, which could cause the USD/MXN pair to appreciate as the US Dollar (USD) regains its ground. Later in the North American session, traders await the United States (US) Nonfarm Payrolls (NFP), which is predicted to remain in positive territory in July.
Mexico was given a 90-day respite by President Trump from the proposed 30% increase in tariffs on a number of items.
The PCE report suggested that the Fed might postpone rate reduction until at least October, which caused the US dollar to rise.
After recording increases for the last five days in a row, the USD/MXN is now trading at about 18.90 on Friday during Asian hours. The pair is struggling as the Mexican Peso (MXN) may improve after US President Donald Trump decided to give Mexico a 90-day respite from increased tariffs of 30% on a number of items in order to give them more time to negotiate a more comprehensive trade agreement.
In accordance with the US-Mexico-Canada Trade Agreement, the US spared Mexico's non-automotive and non-metal imports from a 30% duty. Following a phone conversation between Trump and Mexican President Claudia Sheinbaum on Thursday, this decision was made. "We dodged the tariff rise announced for tomorrow," Sheinbaum wrote in a Thursday post on X, adding that the Trump call was "really nice," according to Reuters. Trump also claimed on Truth Social that Mexico has committed to removing its non-tariff trade barriers right now.
But the United States would still impose a 50% tax on copper, aluminum, and steel from Mexico. Mexican automobiles and non-USMCA-compliant commodities will continue to be subject to a 25% tariff. Measures pertaining to the US fentanyl crisis are linked to these tariffs.
Higher tariff rates imposed by President Trump on US trading partners will take effect on August 1. In order to avoid missing the deadline for trade agreements, Trump issued an executive order on Thursday that imposed duties ranging from 10% to 41% on US imports from dozens of nations and overseas sites, including Canada, India, and Taiwan, according to Reuters.
The recent US Personal Consumption Expenditure (PCE) Price Index report indicated that price pressures would increase in the second half of 2025 and postpone the US Federal Reserve's (Fed) interest rate cuts until at least October, which could cause the USD/MXN pair to appreciate as the US Dollar (USD) regains its ground. Later in the North American session, traders await the United States (US) Nonfarm Payrolls (NFP), which is predicted to remain in positive territory in July.
