NAFTA talks continuing to put pressure on Mexican peso, says minister

Source: Xinhua| 2017-10-17 06:39:17|Editor: Mu Xuequan
Video PlayerClose

MEXICO CITY, Oct. 16 (Xinhua) -- The recent pressure on the value of the Mexican peso is, at least in part, due to the uncertainty surrounding the North American Free Trade Agreement (NAFTA) renegotiations, said Finance Minister Jose Antonio Meade on Monday.

"The markets consider that, in the absence of a treaty, there has be a real adjustment in the exchange rate, which pressures us in consequence," Meade told a business forum.

The Mexican peso opened on Monday at a high of 19.09 pesos to the U.S. dollar, its highest rate in five months.

Another factor making investors nervous in Mexico is the expectation of a normalization of U.S. monetary policy.

"Faced with these two elements that come from outside, what we can do is trying to exercise internal control. What we the ability to steady our fiscal policy," he added.

Concerning NAFTA, Meade said that the central objective of the Mexican government is to secure a good renegotiation, calling the differences between the U.S., Canada and Mexico as part of a "normal process."

The fourth round of NAFTA talks is currently being held in the U.S., with differences beginning to become more pronounced. Mexican Economy Minister Ildefonso Guajardo admitted on Friday that conversations were going through a difficult time.

The U.S. government is seeking to update NAFTA, in force since 1994, with a number of demands, including a five-year expiration clause, the scrapping of a chapter on dispute resolution, and an increasing in rules of origin for the automotive and textile industries, which Mexico and Canada oppose.