The Mexican peso slipped on Monday ahead of the latest round of trade negotiations between Mexico, the United States and Canada later this week. Concerns that US President Donald Trump could make good on his threats to scrap the North American Free Trade Agreement (NAFTA) have battered the Mexican currency in recent weeks. Trump has put forward increasingly strict demands in the negotiations.
"The market is no longer optimistic on seeing any significant gain in this round of negotiations, and is actually concerned that differences will widen," economists at Continuum Economics wrote in a client note. Mexico sells over three-quarters of its exports to the United States.
Nevertheless, losses in the Mexican currency have been limited by the Mexican central bank's assurance that it could act to cushion the currency's decline. The peso fell 0.3 percent on Monday, in line with other Latin American currencies. The Brazilian real weakened 0.3 percent, while the Colombian peso dipped 0.2 percent.