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
Today (4/22/25) the “peso” crepped- up” from 20.77 to 19.58 to the dollar. That is still a long way for catching and bringing the “peso” closer trio the dollar. Yet, the Mexican government makes this announce a big “deal”.
when the peso is still below and behind this much to the dollar.
, I don’t see this so called “strengthen” a “big deal” . It’s confusing. You still need a BIG ” wheel barrel full of “pesos” to have just ONE dollar All of this “double talk” by the Mexican Government is “labeled as “peso “strength”. Hide and confuse the public using “tricky words” to make the economy look better than what it really is.
Geez Optima , with all due respect, Mexico is not competing to have an equal value pesos to the dollar. The history and details that put them at 20 to 1 do not reflect a competition that the US has won nor Mexico lost. That is the same kind of thinking used by Trump who considers Trade Deficits as bad or a country stealing. All a trade deficit indicates is how much one population appreciates what the other makes and can afford to purchase it. Likewise while it takes twenty pesos to equal the value of one dollar, in Mexico the value of the peso is much higher. I mean that the cost of equivalent products and services is about three times less in Mexico than in the US and about five times less for Medical Care, so that puts the pesos purchasing power in Mexico at between and 6 and 4 pesos to the dollar spent in the US.
Please don’t misunderstand the currency values as some kind of win lose proposition. But investors/traders may sometimes wish to invest in one currency or the other for a wide variety of reasons. The dollar used to be the reserve currency of the world, primarily because the US can collect taxes in a routine and organized way and pay the interest on debit incurred to foreigners who buy their bonds. Mexico has a weaker tax collection process but has high reserves and pays a higher interest rate. These details are behind currency values not how much a wheelbarrow or currency weighs.