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Mexican peso's strength cuts into value of remittances from US

Boards displaying the exchange rate of the Mexican peso against the U.S. dollar are pictured outside exchange houses in Ciudad Juarez, Mexico July 27, 2023. REUTERS/Jose Luis Gonzalez/File Photo

Overview

  • Mexican peso has appreciated significantly against US dollar this year.
  • Stronger peso impacts purchasing power of remittances from US which total nearly $60 billion annually.
  • Rise in peso attributed to higher interest rates and manufacturing moving from Asia.
  • Weaker dollar hits lower-income families relying on remittances for expenses and school costs.
  • Despite inflation, remittances still increasing as some send more money to offset impact.