Mexico’s peso surged on Wednesday to a more than one-year high, bolstered by growing confidence that U.S. President Donald Trump will not pull out of NAFTA, as well as a major oil discovery and dovish comments by U.S. Federal Reserve Chair Janet Yellen.
The Mexican currency MXN=D2 gained about 0.7 percent to 17.781 per dollar, a level not seen since May 2016. It has more than recovered from a plunge after Trump was elected and threatened to impose punitive tariffs on Mexican goods to protect U.S. industry.
Expectations that Trump will not shred the North American Free Trade Agreement have fed demand for the peso and helped make it the top-performing emerging-markets currency this year, with a 17 percent gain. On Wednesday it was 3 percent stronger than just before Trump unexpectedly won the election.