### Summary
Mexico has become the top trading partner of the United States, surpassing China and Canada, with trade reaching $263 billion in the first four months of this year. This shift reflects an accelerated move towards "nearshoring" and regional trade, driven by factors such as increased protectionism and the desire for faster delivery times.
### Facts
- 🇲🇽 Mexico has overtaken China and Canada as the top trading partner of the US since the start of the pandemic.
- 🌍 The $263 billion worth of goods traded between Mexico and the US in the first four months of 2021 accounted for 15.4% of total US trade.
- 🌎 In comparison, trade totals with Canada and China were 15.2% and 12% respectively.
- 🚚 The practice of "nearshoring," where countries bring supply chains closer to home, has gained momentum, driven by factors such as increased protectionism and the demand for faster delivery times.
- 📉 The economic chaos of 2020 continues to shape the world economy, with regional trade and nearshoring becoming more prominent.
Please note that the article also mentions the improving relationship between the US and China, as well as the potential for growth in trade between Mexico and the US. However, these points are not included in the bulleted facts above.
### Summary
Global dedollarization efforts are facing a credibility challenge as currencies such as the Russian ruble, Chinese yuan, and Argentine peso suffer significant declines, highlighting the perceived stability and reliability of the US dollar.
### Facts
- 📉 The Chinese yuan, Russian ruble, and Argentine peso have all experienced significant declines in value recently, causing their respective central banks to take measures to stabilize their currencies.
- 🌍 These declines come at a time when countries like Russia and China are actively trying to reduce their reliance on the US dollar in trade and investments, a trend known as dedollarization.
- 💰 However, the recent exchange-rate turmoil and instability of these currencies against the US dollar could undermine the dedollarization efforts and raise questions about the feasibility of finding a common currency to combat the dominance of the dollar.
- 💱 Dedollarization efforts in Argentina have been limited, with some even advocating for adopting the US dollar as the local currency to combat hyperinflation.
- 🌎 While the share of the US dollar in global reserves has decreased over the years, it still makes up nearly 60% of the world's foreign-exchange holdings, highlighting its long-standing dominance as the world's reserve currency.
Note: The text provided is truncated, so the summary and bullet points may not capture the complete context of the original text.
### Summary
The strength of the U.S. dollar against other currencies, such as the Nigerian naira and Zimbabwean dollar, has made it difficult for local consumers to buy foreign goods, leading to economic troubles in these countries.
### Facts
- 💰 The strength of the U.S. dollar has pushed the price of foreign goods beyond the reach of local consumers in Nigeria.
- 💸 Many developing countries are unhappy with the dominance of the U.S. dollar in the global financial system.
- 🌍 The BRICS bloc, which includes Brazil, Russia, India, China, and South Africa, will discuss their grievances against the dollar at a meeting in Johannesburg, South Africa.
- 💵 The alternatives to the U.S. dollar, such as the euro and China's yuan, have not been able to rival its dominance.
- 🇦🇷 In Argentina, a presidential candidate is calling for the U.S. dollar to replace the country's troubled peso.
- 💼 In Zimbabwe, the U.S. dollar is widely used in transactions due to the instability of the Zimbabwean dollar.
- 💸 Vendors in Zimbabwe are even mending damaged U.S. dollar bills for a small fee due to a shortage.
### Credit
By: Dionne Searcey and Constant Méheut
Source: The Washington Post
The US Dollar strengthens as several BRIC countries express support for the currency, while Fed officials remain quiet on rate cuts, and geopolitical tensions boost the Greenback during US trading hours.
The weakening of the U.S. dollar could benefit companies that export products and services, while importers may have to pay more for the goods they bring in, leading them to hold off on purchases. However, a more stable dollar can benefit both importers and exporters.
Mexican economy is forecasted to grow by 2.9% in 2023, while the Mexican peso is expected to trade just under 18 to the US dollar by the end of the year, according to a survey of analysts by Citibanamex.
Latin American currencies are under pressure from a strong dollar as traders await remarks from Federal Reserve Chair Jerome Powell on U.S. interest rates, while the Chilean peso reaches a three-week high; meanwhile, Argentina stocks are seen as a "safeguard of value" amid economic turmoil, but the country faces opposition to joining the BRICS bloc.
The US Dollar performed well against major currencies, with the British Pound, Euro, and Canadian Dollar underperforming, while the Chinese Yuan and Australian Dollar fared better; the Federal Reserve's indication of a higher terminal rate and potential further borrowing cost increases contributed to the market sentiment, leading to lower US equity markets; upcoming economic data includes consumer confidence, inflation gauges from key European countries, and manufacturing PMI gauges from China.
The Canadian dollar strengthens slightly against the US dollar in August despite concerns about China's economy and a decline in commodity-linked currencies.
Most Latin American currencies fell as the dollar strengthened on robust U.S. economic data, with the Mexican peso leading the declines, while Chile's peso gained after the central bank cut its benchmark interest rate and lowered its economic growth forecast for 2023.
The dollar strengthens against the yen and keeps the euro and sterling near three-month lows as investors rely on the resilience of the U.S. economy, while China's onshore yuan hits a 16-year low due to a property slump and weak consumer spending.
The value of the U.S. dollar has been strengthening against the Euro and the British Pound due to the continuing strength of the U.S. economy and the weakness of the European economies.
Latin American currencies and stocks are set for their biggest weekly increases in months, benefiting from a stabilizing Chinese economy, rallying commodity prices, and expectations that the Federal Reserve will stop hiking rates.
Latin American currencies pared gains against the dollar as the U.S. Federal Reserve signaled tighter monetary policy, while Brazilian stocks rose ahead of a rate cut by the central bank.
The upcoming episode of "The Trading Week Ahead" with Luca Santos focuses on the potential impact of the US Dollar strength on the EURUSD, GBPUSD, and AUDUSD currency pairs, analyzing the upcoming economic releases in the forex market.
The US dollar strengthened on positive US economic news, higher bond yields, and hawkish comments from Federal Reserve officials, while the euro weakened due to dollar strength and hawkish comments from the European Central Bank.
