The US dollar dropped below 17 Pesos for the first time since 2015 at the start of Wednesday’s session, before leveling out at around 17.15.
The peso has appreciated by around 20 percent against the dollar since the end of 2022. The sending of remittances, foreign investment driven by the relocation of companies from Asia to North America (known as nearshoring), as well as the attractive yield of Mexican instruments is driving the currency to an atypical appreciation, experts say.
President Andres Manuel Lopez Obrador said his nationalistic management of economic policy, in contrast to his neoliberal predecessors, is mainly responsible for the strength of the pesos, rather than the outside factors that many economists suggest.
Mexico’s remittance income in April reached US$5.3 billion, a 6.3-percent increase from the same month in 2022. Mexico now receives more in remittances than China.