The Mexican peso appreciated to its strongest position against the US dollar in six months on Monday morning as the greenback weakened amid tension between U.S. President Donald Trump and the Federal Reserve.
According to Yahoo! Finance, the peso appreciated to 19.58 to the dollar before weakening slightly. At 10.30 a.m. Mexico City time, the USD:MXN rate was 19.68.
— Gabriela Siller Pagaza (@GabySillerP) April 21, 2025
The last time the peso was stronger was in October 2024.
The appreciation of the peso on Monday morning came after a strengthening of the currency late last week.
Compared to the Bank of Mexico’s closing rate last Wednesday — 19.96 pesos to the dollar before Mexican markets closed for the Easter break — the peso appreciated around 1.9% to reach its Monday morning peak.
The peso gained late last week after President Claudia Sheinbaum spoke to Trump last Wednesday. Both leaders described the call as “very productive.”
On Monday, the peso gained as the greenback lost ground. The DXY index, which measures the US dollar against a basket of foreign currencies, fell to its lowest level since March 2022 on Monday morning, according to a CNBC report.
Trump vs. the Fed
CNBC reported that the dollar continued its slide on Monday as “global investors retreat from U.S. assets in the face of tension between President Donald Trump and the Federal Reserve.”
Trump again took aim at the Chair of the Federal Reserve, Jerome Powell, in a Monday morning post to his Truth Social account.
“‘Preemptive Cuts’ in Interest Rates are being called for by many. With Energy Costs way down, food prices (including Biden’s egg disaster!) substantially lower, and most other ‘things’ trending down, there is virtually No Inflation. With these costs trending so nicely downward, just what I predicted they would do, there can almost be no inflation, but there can be a SLOWING of the economy unless Mr. Too Late, a major loser, lowers interest rates, NOW,” he wrote.
“Europe has already ‘lowered’ seven times. Powell has always been ‘To Late,’ [sic] except when it came to the Election period when he lowered in order to help Sleepy Joe Biden, later Kamala, get elected. How did that work out?” Trump said.
The U.S. president also criticized Powell last week, while White House economic adviser Kevin Hassett said that the Trump administration was exploring whether they could remove the Fed’s top official.
Those remarks “appear to have put even more pressure on the greenback,” CNBC reported.
Gabriela Siller, director of economic analysis at Mexican bank Banco Base, said on X on Monday morning that U.S. protectionism was also a factor in the depreciation of the dollar.
“The current weakness of the dollar is due to 1) Trump’s protectionist policies and 2) uncertainty about the autonomy of the Fed in the face of Trump’s attacks,” she wrote.
Peso has appreciated more than 5% since Trump took office
On Friday, Jan. 17 — the last weekday before Trump began his second term as U.S. president — the peso closed at 20.77 to the dollar, according to the Bank of Mexico.
The currency’s appreciation to 19.58 on Monday morning represented a strengthening of just over 6% for the peso. Based on the USD:MXN rate of 19.68 at 10:30 a.m., the appreciation of the peso since Trump took office was 5.5%.
The newspaper El Economista reported on Sunday that the strengthening of the peso during the first 90 days of Trump’s second term was mainly due to Mexico getting an exemption from some U.S. tariffs (such as the “reciprocal tariffs” announced earlier this month), Mexico’s “high international reserves,” the expectation of lower interest rates in Mexico and “the weakness of the greenback.”
With reports from Expansión, El Economista and CNBC
