2016: Brexit
Brexit, which is the United Kingdom’s exit from the European Union, officially took place on 31 January 2020. The decision to leave the European Union was the result of a referendum held on 23 June 2016, in which 51.9% of voters opted to “Leave” versus 48.1% who voted to “Remain”.
On June 24 of that year, the Mexican peso experienced volatility that took it to 18.94 pesos per dollar. With the sixth highest volatility in recent years, where the difference between the minimum and the maximum was 1.41 pesos.
2016: The rise of Donald Trump
Donald Trump won the presidency of the United States on November 8, 2016. The Republican candidate, he obtained 304 electoral votes compared to his Democratic opponent, Hillary Clinton’s 227, although Clinton won the popular vote by a margin of approximately 2.9 million votes.
During his campaign, Trump had promised to modify or even cancel the Free Trade Agreement between the United States, Mexico and Canada. In addition, his anti-immigrant rhetoric led him to propose building a wall on the border with Mexico and imposing tariffs on that country. All of this led to the exchange rate experiencing its most volatile day, even surpassing that of the 2008 financial crisis. On November 9, the peso plummeted more than 7% compared to the previous close.
2018: Cancellation of NAIM
The then president-elect of Mexico, Andrés Manuel López Obrador, announced the cancellation of the project for the New Mexico City International Airport in Texcoco on October 29, 2018.
The decision was made after conducting a Public consultation which took place from October 25 to 28, 2018, in which the majority of participants voted in favor of stopping the construction of the airport in Texcoco and instead, expanding the military airport of Santa Lucía, today Felipe Ángeles International Airport (AIFA). On October 31, the exchange rate soared to 20.31 pesos.
2020: Pandemic and price war
Before the declaration of a health emergency due to the Covid-19 pandemic in Mexico, the peso had already shown great volatility due to another factor: the price war that Saudi Arabia started against Russia on March 8. That day, the price of US oil fell by 34%, the price of crude oil fell by 26% and that of Brent oil by 24%. And, the next day, the exchange rate showed a volatility of 2.03 pesos, between the maximum and the minimum. And the peso fell more than 5% on March 9.
On March 11, 2020, the World Health Organization (WHO) officially declared the Covid-19 pandemic. In Mexico, however, the declaration of a health emergency was officially issued on March 30, 2020, causing the dollar to skyrocket to 24.45 pesos that same day. It then reached a maximum of 25.30 pesos on April 24 of that same year.
