October 8, 2019 / 8:11 PM / 13 days ago

Trump election rhetoric could send Mexican peso down almost 9% to 21.30 per dollar -Banorte

MEXICO CITY, Oct 8 (Reuters) - The Mexican peso could fall almost 9% to 21.30 per dollar next year if U.S. President Donald Trump again threatens the country during his re-election campaign, Mexican financial group Banorte said on Tuesday.

Trump has repeatedly sent the Mexican currency and stock market tumbling after attacking Mexico over immigration and trade, mostly on Twitter, threatening to impose tariffs on Mexican goods or close the countries’ shared border.

Banorte’s forecast would represent an 8.7% depreciation for the currency from its current level of about 19.60 pesos per dollar. The government’s draft budget estimates an exchange rate of 20 pesos per dollar.

“It is likely that (Trump) will become extremely aggressive in his protectionist rhetoric, both at the migratory and commercial levels, and this will cause an appreciation of the dollar,” said Gabriel Casillas, director of economic analysis at Banorte.

Trump formally launched his re-election campaign in June, positioning himself as the same contrarian who rocked the political establishment in Washington four years ago.

In Mexico, banks and exchange houses quoted the peso on Tuesday at 19.05 pesos per dollar for purchases and at 19.89 for sale. (Reporting by Noe Torres; Editing by Peter Cooney)

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