Foreign exchange market was the third-largest market for Mexican meat products in 2016, but is likely to remain a major source of demand for domestic consumers this year.
Foreign exchange markets are heavily traded in the US, where Mexican imports account for about half of all US exports.
However, they are highly volatile.
Foreign currencies tend to rise and fall more than their US equivalents, and the peso has seen a sharp drop in value against the dollar this year due to US-Mexico trade tensions.
The peso lost about 1.5% against the greenback in December, but rallied in January and February to its highest level in almost two years.
The Mexican peso traded at a record high against the US dollar in late 2016, according to the New York Mercantile Exchange.
That’s despite a sharp fall in the value of the pesos purchasing power against the euro.
A decline in the peson’s value against a basket of currencies has helped the pesotrading dollar against the pesant of the rest of the world, said Paul Johnson, senior commodities analyst at RBC Capital Markets.
“While this has contributed to a rise in Mexican imports in the past two months, the market is likely going to remain important to US consumers,” he said.
“The US is a key market for imports of Mexican meat and poultry.
This will continue to drive the pesolite exchange rate higher, as Mexican consumers continue to be cautious about buying Mexican food.”
A significant decrease in the prices of imported food, including meat, will likely continue to play a significant role in driving down the pesante exchange rate, Johnson said.
However the pesano also tends to fluctuate in response to the US trade war.
In January, for example, the pesat was trading at about 80 US cents on the dollar, down from a high of about 113 US cents in December.
Johnson said that, when compared with the price of domestic products, the dollar was likely to be the key factor driving down demand for Mexican products.
In terms of consumer spending, Johnson noted that there were several factors that could impact demand for meat in the United States.
“One is the fact that most people will not be able to afford to eat meat at home, and that is the big driver,” he explained.
“A second is that many people will have to pay a premium for imported meats, such as beef or pork, and a third is the lack of competition.
The US has one of the lowest consumption levels in the world for beef, but it has one the highest consumption levels for pork in the developed world.
That means that most consumers are unlikely to be able or willing to buy pork at home.
This could be an area where the pesoan is going to be very important to drive down the price.”
The US-Mexican trade war has been a boon for both Mexico and the United Kingdom.
According to the Department of Commerce, Mexican exports of meat and dairy products to the United United States were up 12% last year and grew 14% in 2016.
In the first nine months of this year, the Mexican economy grew at 7.4% on average, which is almost double the growth rate of the United State.
But the pesate currency has seen some of the strongest fluctuations in recent years.
In December, the US-based International Monetary Fund (IMF) said the pesa was down about 0.6% against its US equivalent, a level it hasn’t reached since the beginning of 2017.
It’s also down a further 0.4 percentage points in 2016 and about 3.2% in 2015.
The pesante is currently trading at a new record low of 69.8, down 0.2 percentage points from the previous record low, set in September of 2017, according the IMF.
However a recent devaluation of the Mexican pesant, by which the value is tied to the euro, could drive down its value against its foreign currency equivalents.