DawgTalkers.net Forums DawgTalk Everything Else... Mexico peso hits record low on Trump uncertainty, more weakening feared

Mexico's peso MXX=D2 slumped to a new low against the dollar on Tuesday, fueled by concern about the policies of U.S. President-elect Donald Trump, and comments by an economic think tank that further depreciation is "almost inevitable."

The peso was the worst-performing major currency last year, weakening 20 percent against the dollar as Trump closed in on the U.S. presidency. It skidded further to a low of 21.8275 per dollar by mid-afternoon, dipping 2 percent.

The depreciation has accelerated in the first few days of 2017 after Trump told major automakers last week to expect high taxes on vehicles made in Mexico that are sold in the United States as he attempts to bring back manufacturing jobs.

As long as uncertainty persists about what Trump will do once he takes office on Jan. 20, the peso could face more pressure.

"It's foreseeable. I'd say almost inevitable that it keeps on depreciating," said Jose Angel Gurria, secretary general for the Organization for Economic Co-operation and Development at a news conference in Mexico City.

The peso has fallen by more than 5 percent against the dollar since Jan. 1, according to Reuters data.

Gurria, who served as Mexico's finance minister from 1998 to 2000, said Mexico's central bank, which sold $2 billion in dollar reserves last week to support the peso, had helped prevent a deeper crash. But he warned it could not burn through too many greenbacks.

Many analysts fear the peso's fall is fueling higher inflation, which picked up to its fastest pace in 2 years last month.

Consumer prices could be further fanned by a double digit gasoline price hike this month that has spurred protests, looting and road blockades.

"Without a doubt, it will have a one-off inflationary impact," Gurria said, referring to fuel prices. Mexico's government has said the hike would not hit inflation.

Trump has vowed to withdraw from a joint trade deal with Mexico if he cannot renegotiate it in the United States' favor, and he has threatened hefty tariffs on Mexican-made goods.

At the launch of his campaign in mid-2015, the New York real estate magnate riled many Mexicans by pledging to build a border wall to keep out illegal immigrants, accusing Mexico of sending rapists and drug runners across the border.

Trump said on Friday that Mexico would repay the United States for the wall, a day after news emerged that his transition team was exploring getting the Republican-led Congress to vote to approve funding.

Mexican Foreign Minister Luis Videgaray on Tuesday restated the government's position that his country will not pay for the wall, and he noted that uncertainty over future trade relations is impeding investment to Mexico.

http://www.reuters.com/article/us-mexico-peso-intervention-idUSKBN14U1ZG

So how does a broke country pay for a wall? If this decreases too low, some companies might be willing to take a tariff hit if they can pay for essentially slave labor.

Mexico would be well advised to pay the paltry $10 Billion for that wall before it costs them everything.

Broke countries don't pay.

And even if they had money, they still aren't gonna pay for it.

All well. Might take the fam on a vacation. El cheapo

Mexico doesn't care about Trump's little wall folly...American tax payers are already on the hook for it. Hooray Trump!

We give Mexico $51 million in foreign aid each year. Keep that for 20 years and/or add tariffs at the border, and this could easily be paid for.

Better build that wall REALLY tall. Once we impoverish their country it'll look like World War Z as they try all the harder to escape their poverty.

Not if we have a legitimate, fair, and monitored/vetted immigration system.

It amazes me that some people think that allowing just anyone into this country, without having any idea who they are. I am, frankly, surprised that Isis hasn't taken advantage of our weak borders, and just walked into our country from either Mexico or Canada. I think that the one thing we have going for us is the=at Mexico actually cares about their borders, and who they allow into their country. They throw those apprehended in their country illegally into prison. I wonder why it is OK for them to enforce their borders, while if is a terrible thing if we d so.

We don't? Mind posting some examples?

Also do you really think ISIL isn't and hasn't tried our immigration service? Ha!

I can give you 11 million examples if you would like.

Be my guest

Because I'm pretty sure cartels would gun down somebody that looked like they were a member of ISIS. That is their "vetting."

Never said I was for open borders. I just think it's absurd to spend our money on a wall while Flint Michigan is drinking poison from their taps, while bridges across this country fall into disrepair. As TUNNELS WILL CONTINUE TO GO UNDER WHATEVER MULTI-BILLION DOLLAR MONEY SUCK we construct. And as most of those in this country illegally started out here legally and overstayed their visas, the wall will do little to stop anything.
But sure, Mexico will pay us back. Even if they did I don't trust this administration to actually repay the American taxpayer's 'loan'. Donald is known for not paying his loans, only this time when he wants to file bankruptcy we all lose.
Go ahead though and continue to worship at the alter of the anointed orange one. I have nothing but distrust and disgust.

Ironic how you have no qualms about calling trump orange, isn't it?

He is. Well, except around his eyes.

Orange lives matter.

So, you're racist? Orange people don't have feelings?

Whats absurd is that thousands of small towns and villages are drinking water worse than Detroits, yet the DEMS didn't give a crap about any of it. Of Course the repubs are just as guilty of ignoring the problem for years also. Both sides have sucked ass for years.

He didn't look nearly as orange today on tv.

If we don't have to spend taxpayer money on people here illegally, we have more money for other things. Plus, I do think that there are ways that Mexico is gong to wind up paying for the wall. Maybe not 100% of it, but a lot of it, and probably a lot more than many people think.

I suspect that we are going to see a combo bill that allows a one time repatriation of money held overseas at a 10-15% tax rate .... with that tax money being used for a massive, true infrastructure bill. I have read that there might be as much as $4 trillion being held off shore because of our tax code. That could give us anywhere from $400-$600 billion right there. I think that we are going to see a ton of creative solutions, using private/public cooperation on a lot of infrastructure projects. i am intrigued by some of the ideas I have heard floating around. We'll see if they work. God knows that what we've been doing doesn't work.

it's been pretty clear that from the start, the " un quote, " " wall",isn't really going to be paid by Mexico,

But, it will be claimed to be, because it's going to be paid for by the money made up for in trade differential with Mexico, before and after.


Seriously folks, Buy Peso's, what the hey, anyone would be numb to believe statements that it is
" inevitable" that it will continue to fall.

continue to fall? yaa, right, short term, maybe, but long term,

let's take a look,

uhh, 90% of the time presidents lose congressional hold in the 2nd year of their presidency.
90% of the time presidents don't get much agenda wise after their fisrt 100 days.

Countless Millions of people living in America have close personal ties with people living in Mexico, and large business' have " interests" that span both Mexico and the USA.

Now there could be a general drop or rise in both currencies due to any bull or bearish variable, but

if the USA has an all time high, or rather the Peso is at an all time low, vs the Dollar, then now's the time to get in,
now's the time to get into the peso, because I'd bet the items would come back to their conventional exchange over time.

Which would be an increase, ( meant to be spoken like John Lovits' character in the movie ' a league of their own" when he tells the Gina Davis character she and her sister would be making more if they played. )

always buy low, sell whenever.

I think it's been clear from a year ago or more, if Hilary were elected, we'd see another recession, if Trump were, we'd see high inflation.

Take a picture of the price tag of anything, double it, and add 10 percent, and I think, well there's at least a possibility we will approach that some time in the next 5 years, regardless of what happens at the ballot box.

40 dollar pair of blue jeans, double it, 80, at 10 percent, 88 dollars.

a big mac, 3.69, double it, about 7.20 at 10 percent, 72 cents,
an 8 dollar big mac, maybe ad's for the 10 dollar value meal?

Well, I think McDonalds might be insulated against inflation by (who knows, ((secret government)), but the blue jeans, could happen,

it ain't going to be pretty.

I'd rather just offer Mexico a chance to be a state in the USA and be done with it. It's not like they have shown the ability to govern themselves and it would enable us to get rid of a huge national security risk.

If they don't want it then just eliminate visas for a few years. They would topple their own corrupt government then.

That is all? I think a country like China could more than make that up. I would think that they are looking at all kinds of ways to increase there influence in our neighborhood. We cause them all kinds of problems over there, I would guess that they would like to return the favor if they could.

Exactly.

Our enemies would love to make a friend in Mexico.

The oligarchs in power would never go for that. Not when they have such a cheap labor force so close by. Cheap labor, easy transportation/import costs. Even raising the wages to our minimum wage would cut too deeply into their profits. Nope can't have that.

Mexicans are far too proud of their Country to even consider becoming a united state. I think they would rather war with us and lose than join us.

Not true the Mexican President just announced they'll give us Baja if we pay for the wall.

Now that would be the Art of the Deal!

Got a linky thing?