Economic indicators refer to the superweightthis condition of the national currency against the US dollar, which basically refers to the strength and appreciation of the Mexican peso in relation to the currency of the neighboring country. But how long will it last?
The Mexican Institute for Competitiveness (IMCO) responded to this question with the analysis of Jesús Carrillo, director of Sustainable Economy:
“The appreciation of the peso against the dollar is due to several reasons that cause there to be more demand for pesosThat is, having money in our currency is more attractive or necessary. Among them are sending remittances and high interest rates in Mexicowhich can give you better performance for savers who have dollars. Predicting the exchange rate is a very difficult task because there may be exogenous eventssuch as a possible economic slowdown in China that causes many savers to want to insure themselves against a possible crisis.”
On the other hand, according to researchers from the National Autonomous University of Mexico (UNAM), Eufemia Basilio Morales and José Manuel Márquez Estrada, The current valuation of our currency against the dollar will not last, “unless the internal economy, especially trade, is strengthened”.
According to UNAM specialists, “the appreciation of the peso derives from multiple factors related to Mexican politics, such as government restrictions, the contraction of spending and not increasing debt during the most difficult period of COVID-19”so it is expected that the economic effect referred to has an expiration date.
To conclude, Márquez Estrada declared that a superweight is not synonymous with “better conditions for the economy. In the current situation it has helped us, but this type of change is not sustainable. Nor would it be so desirable for the weight to be appreciated more because Mexican exports would become very expensive. Maintaining a strong exchange rate at the expense of maintaining low economic growth is not a business, the idea would be to take advantage of this situation and try to find better conditions to make this phenomenon bear fruit in the medium and long terms.”
It is important to remember that the superweight trend can be reversed at any time.
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