Investing.com – The U.S. dollar was lower against other currencies on Monday while the Mexican peso was higher after the U.S. and Mexico agreed to a trade deal.
The neighboring countries came up with a new agreement in the rengogation of the North American Trade Agreement (NAFTA).
“We will call it the United States-Mexico Trade Agreement,” U.S. President Donald Trump suggested. Discussions with Canada have yet to begin.
All three governments were aiming to make a trade agreement before the end of August.
The U.S. dollar index, which measures the greenback’s strength against a basket of six major currencies, remained under pressure after the news, falling 0.38% to 94.72 as of 11:26 AM ET (15:26 GMT).
The Mexican peso surged against the dollar, with USD/MXN slipping 1.45% to 18.6523.
The dollar was lower against the safe-haven yen, with USD/JPY decreasing 0.19% to 111.05. In times of uncertainty, investors tend to invest in the Japanese yen, which is considered a safe asset during periods of risk aversion.
The Turkish lira fell against the greenback, with USD/TRY rising 2.07% to 6.1013. The lira has been under pressure over the last few weeks as the U.S. and Turkey disagree over a detained American pastor.