US Dollar Strenghtens Amid Trade Tensions: Trump's Tariffs Threat Weakens LATAM's Main Currencies

(MENAFN- Investor Ideas) Investorideas, a go-to platform for big investing ideas releases market commentary from Quasar Elizundia, Expert Research Strategist at Pepperstone.

"The US dollar experienced a significant increase following recent comments from President-elect Donald Trump, who reaffirmed his intention to impose 25% tariffs on products from Mexico and Canada, as well as 10% on Chinese imports. These statements initially strengthened the dollar, with the DXY index climbing to 107.5 before retreating to around 107. In particular, the Mexican peso has been one of the most affected instruments, falling by over 1% during the session against the US dollar, reflecting the currency's vulnerability to trade tensions with its main trading partner.

Trump's protectionist rhetoric has raised concerns about a potential escalation in trade wars, which could lead to an environment of greater volatility for global markets. Notably, this announcement has reignited worries about the potential inflationary impact. This has put traders in a cautious mode, especially with the upcoming FOMC minutes, which may provide greater clarity on the Federal Reserve's monetary policy direction in this new environment of heightened volatility and uncertainty.

The Colombian peso has also felt the effects of trade tensions, albeit less severely than the Mexican peso. The COP's depreciation, down by 0.7%, reflects concerns about how US protectionism could impact Colombian exports to the United States. In contrast, the Chilean peso has shown greater resilience due to its diversified export base. However, Chile remains vulnerable to a potential decline in global demand for commodities, which could negatively affect its currency.

Amid a context of growing uncertainty, Latin American currencies face significant pressures, and Trump's tariff policies could deepen volatility in the region. With the PCE inflation data set to be released this week, markets will be closely monitoring any signals that could shift expectations for the US economic outlook and monetary policy."

About Investorideas - Big Investing Ideas

Investorideas is the go-to platform for big investing ideas. From breaking stock news to top-rated investing podcasts, we cover it all. Our original branded content includes podcasts such as Exploring Mining, Cleantech, Crypto Corner, Cannabis News, and the AI Eye. We also create free investor stock directories for sectors including mining, crypto, renewable energy, gaming, biotech, tech, sports and more. Public companies within the sectors we cover can use our news publishing and content creation services to help tell their story to interested investors. Paid content is always disclosed.

Disclaimer/Disclosure: Investorideas is a digital publisher of third party sourced news, articles and equity research as well as creates original content, including video, interviews and articles. Original content created by investorideas is protected by copyright laws other than syndication rights. Our site does not make recommendations for purchases or sale of stocks, services or products. Nothing on our sites should be construed as an offer or solicitation to buy or sell products or securities. All investing involves risk and possible losses. This site is currently compensated for news publication and distribution, social media and marketing, content creation and more. Contact management and IR of each company directly regarding specific questions. More disclaimer info: More disclaimer and disclosure info Learn more about publishing your news release and our other news services on the Investorideas newswire News-Upload/ Global investors must adhere to regulations of each country.

MENAFN26112024000142011025ID1108929026