• Trump releases Mexico and Canada from sweeping up-to-date tariffs; China, the EU and others went from duties to 46%.
• Sheinbaum avoids retaliation, while Mexico planned fiscal increases a narrower deficit and hopeful growth goals.
• Strong American work party supports USD, but focus on the comments of ISM Services PMI, NFP and Powell this week.

The Mexican peso (MXN) issued a return on Wednesday, ending the session with a sturdy note with profits of 0.86%, because Mexico and Canada were released from the mutual tariffs of the US President Trump. At the beginning of Thursday, the Asian USD/MXN session changes his hands with 20.24 by about 0.33%.

Recently, US President Donald Trump announced that the US will impose 10% tariffs on all imports and 25% of cars. These obligations become effective on April 3.

Mutual tariffs are used in some countries. China is affected by 34% of their duties, the European Union with 20%, 46% to Vietnam, 24% to Japan and 10% to Great Britain,

In the meantime, Mexico President Claudia Sheinbaum said that she would not impose the Tit-For-Tat tariff, causing a decrease in the USD/MXN pair, which was bought by the buyer, maintaining an exotic pair at known levels.

The Ministry of Finance in Mexico announced that the fiscal deficit in 2026 will narrow down, according to Bloomberg, “Sheinbaum administration said that it will be focused on a budget gap of 3.2% to 3.5% of gross domestic product next year, less than this year’s ambitious respect of 3.9% to 4%.”

The ministry changed the growth forecast to 2025 to about 1.5%-2.3%, which is a very hopeful scenario compared to Banco de Mexico (Banxico) respect. The Organization of Economic Cooperation and Development (OECD) provides that Mexico’s GDP concludes a contract by 1.3%.

Data in the US revealed a sturdy labor market, and companies employ more people than expected by economists, exceeding February reading. At the same time, factory orders have expanded above forecasts, but immersed compared to January data.

This week, Mexico’s economic program will include constant investment data and consumer trust data. In the United States, traders focus on PMI services of ISM on the march, numbers of non -parish wages and the speech of the FED chairman Jerome Powell.

Daily Digest Market Movers: Mexican peso falls on uncertainty about tariffs

• According to Inega, Mexico’s business trust has deteriorated rapidly in February. Meanwhile, S&P Global announced that production activities were shrinking after the fifth of a month.
• The Governor of Banxa, Victoria Rodríguez Ceja, stated that the central bank would remain careful on the US trade policy and their influence on the country, with the main emphasis on inflation, as noted in an interview with El Finans.
• In March, the National employment report of ADP revealed that companies added 155,000 people to the labor force, exceeding the forecast of over 105,000 jobs and more of 84,000 jobs created in February.
• Other data showed that factory orders in February exceeded 0.5% estimates and extended 0.6% MOM, compared to 1.8% in January.
• At 20:00 GMT Donald Trump is to announce the imposition of mutual tariffs to trading partners in the White House of Rose Garden.
• According to analyst Steven Palacio, JP Morgan supports an additional 50 BPS in Mexico due to the risk of direct recession. Palacio added that Mexico will be used in a recession widespread by tariffs and “uncertainty surrounding their implementation.”

Technical perspectives in USD/MXN: Mexican peso walks with water like USD/MXN climbing above 20.40

USD/MXN remains biased up, trading near the weekly highest level of 20.54, but is contained because of uncertainty as to the result of the tariff. If the obligations are used without exemptions, the peso may cushioned sharply. In this result, the couple could have challenged on March 4 at 20.99, followed by the peak on February 3, 21.28.

On the other hand, if Mexico is released from tariffs caused by USMCA free trade principles, USD/MXN may immerse below the first level of support, perceptible at the confluence of 50- and 100-day straight medium traffic (SMA) around 20.35/36, and then 20.00. The violation of the latter will reveal the 200-day SMA at 19.76.