Investing.com — The Mexican peso and Canadian dollar fell sharply against the U.S. dollar on Tuesday, while the offshore rate fell after President-elect Donald Trump said he would impose a 25% tariff on all products from Mexico and Canada. and an additional 10% tariff on goods from China, citing concerns about illegal immigration and the illegal drug trade.
Trump said in a post on Truth.social that he had had numerous conversations with Chinese officials about curbing the supply of drugs, particularly fentanyl, to the US, but claimed that such talks had not yielded any results and that “drugs are still were always flowing’. into our country, mainly through Mexico, at a level never seen before.”
The Mexican peso pair rose 1.8% to its highest level since early November, while the Canadian dollar rose more than 1% to its highest level since May 2020.
In China, the offshore yuan pair rose 0.3% on Tuesday. Trump had threatened to impose a tariff of up to 60% on all Chinese goods, a move that could potentially spark a new trade war between the world’s largest economies.
They rose 0.5%, while also higher in Asian trading.
During the election campaign, Trump consistently advocated imposing a uniform 10% import tariff that would apply to all of the United States’ trading partners.
