The Mexican peso’s strength against the dollar has become the stock to watch in this presidential election. Donald Trump’s hard stance on our southern neighbor, including a Mexican-funded border wall and renegotiation or removal of the North American Free Trade Agreement (NAFTA), means that a Trump presidency would likely hurt the Mexican economy.
After a two percent bump in the Mexican peso against the U.S. dollar following the presidential debate last Sunday, investors in Mexico seem more confident in a Hillary Clinton presidency.
If Donald Trump is elected president and pulls through on his promises with Mexico, the Mexican economy would likely struggle with the limited access to the American market.
Markets are built around expectations, so the strength of the peso signals the expectation that things are going to get better in Mexico, which lends itself to Clinton’s policies.
But the peso was about the only stock to make movement in what appears to be a direct response to the debate. Other stocks remained relatively unchanged, which Reuters attributed to the lack of discussion on policy at the debate.
Economic analysts don’t like this lack of policy discussion. They want to know where each candidate stands on each industry so they can price their investments before the election. If a candidate promises to support the diary industry or crack down on wind turbines, people can invest according to who they expect will win. While the debates are typically the place to put candidates’ policy stances side by side, many felt the debate on Sunday turned into a name-calling competition with little discussion on hard policy matters.
Crop prices (Oct. 10)
Rio Creek Feed Mill – Algoma
|Commodity||Price (per bushel)||Basis|
|New-Crop Wheat (SRW)||$3.60||-0.81|
Fox River Valley Ethanol – Green Bay
Basis: The difference between the local cash price for a commodity and the Chicago cash price (where the Board of Trade sets national futures price).
Gas Price Averages
United States: $2.26
United States one year ago: $2.32
Wisconsin one year ago: $2.51
Northern Door: $2.38
Sturgeon Bay: $2.32
Gold: $1,263.50/troy ounce
Silver: $17.72/troy ounce
Sources: aaa.com, agweb.com, gasbuddy.com, money.cnn.com, Reuters, Wall Street Journal