EU FX Handover: US Tariffs on Mexico Dominates Sentiment

  • Mexican peso and stock markets further extended their declines after suffering heavy falls overnight.
  • Already concerned about the escalation in the US-China trade spat, investors went in full panic mode after Donald Trump rather unexpectedly promised to impose a 5% tariff on Mexican goods, effective from June 10.
  • Among the majors, the Canadian dollar has remained the weakest with safe haven yen being the strongest, though profit-taking saw both come off their extremes at the time of writing.
  • Volatility is likely to remain elevated next week, given this week’s big falls in the stock markets, as well as the upcoming data releases including NFP and central bank decisions.

Related tags: Forex

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