Friday, May 28, 2010

Weekly Currency Update: Peso

Today the Mexican Peso is trading at $12.77 MXN = $1 USD.  This has been the worst month since February 2010 for the peso.   
The events that have affected the peso's value this week include:

  • Weaker than expected US economic data (as they say, when the US gets a cold, Mexico gets pneumonia!)
  • The report that China is reviewing its Euro bond holdings
  • The European debt crisis
In a related note, Hacienda (Mexico's IRS) has placed a restriction on dollar cash deposits in Mexico.  This has created a parallel black market for dollars, which can pose a huge threat to the economy.  The restriction was put in place in an effort to curb money laundering.

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