Ignacio Teson•Friday, January 31, 2025•1 min read Add an article to your Reading ListRegister now to be able to add articles to your reading list."
Ignacio Teson•Friday, January 31, 2025•1 min read
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In recent minutes, Trump’s tariff decisions have caused significant market jitters. On Friday, the Mexican peso was trading at 20.7213 per U.S. dollar, marking a 1.40% depreciation compared to Thursday’s closing rate.
This decline—equivalent to a loss of 29.9 cents—followed an announcement from White House Press Secretary Karoline Leavitt, confirming that on February 1, the United States will impose a 25% tariff on imports from Mexico and Canada and a 10% tariff on Chinese products.
USD/MXN
“President Donald Trump will implement 25% tariffs on Mexico and Canada and a 10% tariff on China tomorrow for allowing the entry of illegal fentanyl into our country, which has killed tens of millions of Americans,” Leavitt stated in a press conference.
Initially, reports suggested that Trump was reviewing the details of the tariffs, with potential exemptions being considered. Reuters even cited U.S. administration officials who hinted at a possible postponement until March 1. This speculation briefly strengthened the Mexican peso (+1%) and the Canadian dollar while causing the U.S. Dollar Index (DXY) to drop by approximately 0.6%.
However, within minutes, the White House denied these claims and reaffirmed the February 1 deadline.
Country Tariffs and Market Outlook
Press Secretary Karoline Leavitt clarified to the media that these tariffs are not the beginning of a trade war but rather a measure aimed at combating fentanyl trafficking. She reiterated that the tariffs will remain at 25% for Mexico and Canada and 10% for China.
Volatility is expected to persist until the stock market closes and may extend into next week as the market assesses the impact of these trade measures or awaits a response from the Mexican government.
Ignacio Teson
Economist and Financial Analyst
Ignacio Teson is an Economist and Financial Analyst. He has more than 7 years of experience in emerging markets. He worked as an analyst and market operator at brokerage firms in Argentina and Spain.
www.fxleaders.com