Mexicans Are Worried About Their Plummeting Peso - But One Economist Says They're Lucky Alan Hernandez and Saana Ihamaki - VICE News
go to original January 28, 2016

In recent months the value of Mexico's peso has dropped nearly every day and is now hovering around 19 to the US dollar — an historic low. Many Mexicans are already hurting, and more are worried of what is to come, but economists say they are lucky the situation is under better control compared to other Latin American countries.

"The upper class is not affected but the rest of us suffer," said Cristobal Casimiro, as he sold toy violins from a blanket laid out on the street in a middle class district of Mexico City. "I have problems in sales. How can we compete? A toy is not a basic need."

Laura Valdepeña, who runs a small cosmetics store in the upscale Condesa neighborhood, said she was also feeling the pinch.

"In my store products from the US are already expensive and they are getting even more so," she said. "I need to search for cheaper products to maintain my business."

Georgina Weller said her job in an indigenous rights NGO has been directly impacted by the peso's volatility.

"I travel a lot to present reports," she said. "We have lost our budget. All of our money is going to expenses."

The Mexican peso's value against the US dollar has dropped by 27 percent since mid 2014 when it was valued at around 13 pesos. It topped 16 pesos by December with the depreciation accelerating rapidly after that. The currency reached a historic low of 19.10 pesos last week and, although it has recuperated slightly following an uptick in the oil price and some good news from China, most observers expect it to remain around that level for the next week.

Read the rest at VICE News

Related: BofA Says Mexico's Peso Is Cheapest Currency in Latin America (Bloomberg)

Photo: Alan Hernández

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