USDMXN is an exotic pair consisting of the US dollar (USD) as the base currency and the Mexican peso (MXN) as the quote currency. Among the exotic pairs that include the USD, USDMXN is a favorite among traders and the most heavily traded. USDMXN refers to how many MXN are needed to buy 1 USD.

What is USDMXN?

One of the most controversial forex indexes remains between the US Dollar and the Mexican Peso. The two countries have a vast trade history, and they are North American neighbors in the NAFTA treaty for the free capital and trade movement in North America with Mexico and Canada. However, the Mexican Peso has been degrading throughout the years, and the forex index has produced some excellent profits for people who invested in it. The USDMXN is one of the leading forex indexes in North America. It works around the clock. Mexico and the United States have the same time zone, so their markers work simultaneously. However, the Mexican Central Bank has a different policy than the FED regarding overnight interest rates. That has affected the long-term Mexican Peso price and given people the right to save their money in US Dollars even though they reside and work in Mexico. To understand how to invest in USDMXN, traders must understand this rich historical and geopolitical connection.

How does USDMXN work?

The currency pair works by trading on various platforms, like SimpleFX. First, the trader needs to open an account. SimpleFX provides a demo account where investors can learn how to trade USDMXN. It gives access to the simulation of real-time market conditions without financial risks. The USDMXN market works daily. Traders can invest in it by opening an account on the SimpleFX platform. There is the chance to put a call option to enter the index only when it reaches a certain level. Even though the USDMXN fluctuations exist, it could be better to make it happen daily. The USDMXN forex index shows the relative strength or weakness of the US Dollar compared to the Mexican Peso. Even though the two currencies have an almost 200-year history, their issuing policies differ significantly. Therefore, investing in the USDMXN is better only when investors are sure about their willingness to wait a long time before exiting the index with profits. Both fiscal authorities prevent short-selling to ensure that their currencies avoid market manipulation.

USDMXN price history

Here is the latest historical performance of the USDMXN index:

2018

During 2018, the USDMXN index was close to 19 Mexican Pesos for 1 US Dollar. That happened due to the loosening of the Mexican economy, which showed some impressive inflation rates affecting the actual price of the Mexican Peso in the world trade forex market.

2019

2019 was a relatively easy and stabilizing year for Mexican-American economic relations. That has been depicted in the USDMXN price, which stabilized at 19.5 Mexican Pesos for 1 US Dollar. It is one of the highest we have seen lately and helped many investors get a good return on their investment in the Forex index.

2020

With the pandemic outbreak, we have seen production stop in Mexico for at least two months. That made the forex index go close to 22 Mexican Pesos for 1 US Dollar. However, by the end 2020, the equivalency had returned to the usual 19 Pesos for 1 US Dollar.

2021

Even though the Mexican Central Bank has tried to peg the Mexican Peso price to the US Dollar, the former has depreciated in 2021. The forex index price was close to 20 Mexican Pesos for 1 US Dollar throughout the year, showing the relative strength of the US economy compared to the Mexican one.

2022

Fears of inflation in the US economy forced the index rate to go lower at 19 Mexican Pesos for 1 US Dollar. That trend in 2022 remains the same for 2023 when the global economy stabilizes after the world's energy crisis and the European War outbreak.

Current USDMXN price

The current USDMXN price is subject to fluctuation due to the volatility of the forex market. Investors can check it on the chart or the SimpleFX Webtrader platform.

Is USDMXN a good investment?

Whether USDMXN is a good investment depends on factors such as interest rates, monetary policies, geopolitical events, etc. The answer depends on analyzing these factors and the potential returns on investment. If the factors are also stable and there are more chances of return, this currency pair brings more interest from investors eager to learn how to invest in forex worldwide.

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