Mexican Peso Hits New Highs as NFP Report Looms and Mexico Seeks Tariff Exemption

Full SEO-Optimized Article for Tredu.com:

Mexican Peso Strengthens Ahead of US Jobs Report Amid Tariff Talks

The Mexican Peso (MXN) extended its rally on Thursday, reaching its strongest level against the US Dollar (USD) since October, as the forex market eyes Friday’s US Nonfarm Payrolls (NFP) report and shifting dynamics in US-Mexico trade relations.

At the time of writing, USD/MXN is trading near 19.15, marking new yearly lows and reflecting growing investor confidence in the Peso. The move is largely attributed to expectations of weaker US labor data, which would likely reduce pressure on the Federal Reserve to tighten monetary policy further.

US Jobs Data in Focus

The upcoming NFP report, due Friday, is critical for short-term USD/MXN direction. A weaker-than-expected job print could further depress the US Dollar, supporting emerging market currencies like the Peso. Traders are watching for signs of labor market cooling after a series of soft macroeconomic releases from the US.

Mexico Seeks Tariff Exemption

Adding to the Peso’s strength is Mexico’s proactive stance on trade. The country is set to formally request an exemption from recently proposed US tariffs on steel and aluminium. This comes at a pivotal moment in US-Mexico relations, with diplomatic and economic interests increasingly intertwined.

A favorable outcome could ease trade tensions and provide additional tailwinds for the Peso in the near term.

USD/MXN Outlook: Downtrend Intact

From a technical standpoint, USD/MXN remains in a broader downtrend, and the pair appears vulnerable heading into the NFP report. Support is building below 19.15, and further downside could be seen if the data disappoints.

Traders should also keep an eye on central bank commentary, cross-border trade policy updates, and US macroeconomic indicators as key drivers.

Related Reads on Tredu: