MXN and CAD guided by NAFTA developments – BBH

Analysts at BBH explain that the Mexican peso and Canadian dollars continue to respond positively to the latest turn in the NAFTA plot.  

Key Quotes

“On Sunday, President Trump threatened to leave NAFTA talks and was critical of Mexico's border controls.  Late yesterday, press report suggested that Trump was pushing for a preliminary NAFTA agreement to be announced next week at the regional summit in Peru (April 13-14).  The idea is to get an agreement in principle and then allow the technical talks to work out the precise details.”

“The eighth round of talks were to begin next week in Washington, but top Mexican and Canadian officials were reportedly coming to the US this week to meet US officials.  Trump's weekend tweet may have been designed to exert pressure on the (Mexican) negotiators for additional compromises.  Of course, it seems like it is in the interests of all three parties to reach an agreement shortly.  The talks were to have ended last year and were extended.  Many see the Mexican elections in July as an obstacle if talks continue much longer.  A re-negotiated NAFTA would be seen as a win for Trump, that the negotiating strategy worked.”