# Scrapping NAFTA Will Sink the Peso and Expand Trade Deficit | PIIE

> A PIIE commentary argues that scrapping NAFTA would sink the Mexican peso and widen the US trade deficit. It notes the peso has recovered to a level above its pre-election value as NAFTA renegotiation talks proceed. The author says markets have shown little reaction to tough US rhetoric on the agreement.

- Date: 2017-08-29 · published 2017-08-29T12:00:00.000Z
- Category: policy · region Mexico · magnitude low
- Page: https://feedsoft.ai/events/69671-scrapping-nafta-will-sink-the-peso-and-expand-trade-deficit-piie
- Commodities: [Corn](https://feedsoft.ai/c/CORN.md), [DDGS](https://feedsoft.ai/c/DDGS.md), [Mexican Peso (MXN per USD)](https://feedsoft.ai/c/USDMXN.md)

## Why it matters

Trade-policy risk to US-Mexico flows matters for feed buyers because Mexico is a major importer of US corn, soymeal and DDGS. Continued calm in the peso suggests no immediate change to Mexican purchasing power, but a NAFTA exit would threaten that demand.

## Read by commodity

- CORN: neutral
- DDGS: neutral
- USDMXN: neutral

## Similar past events

| Commodity | Date | Event | 5-day % | 20-day % |
| --- | --- | --- | --- | --- |
| CORN | 2019-11-04 | [Will Farmers Gain from the New US-China Trade Truce? \| PIIE](https://feedsoft.ai/events/55912-will-farmers-gain-from-the-new-us-china-trade-truce-piie.md) | +0.9% | +1.4% |
| CORN | 2019-04-24 | [Will a US-China Trade Deal Remove or Just Restructure the Massive 2018 Tariffs? \| PIIE](https://feedsoft.ai/events/59450-will-a-us-china-trade-deal-remove-or-just-restructure-the-massive-2018-tariffs.md) | -1.5% | +5.3% |
| CORN | 2018-10-17 | [Food safety and GMOs in the “new NAFTA” \| IATP](https://feedsoft.ai/events/62507-food-safety-and-gmos-in-the-new-nafta-iatp.md) | -2.1% | -7.0% |
| CORN | 2021-02-08 | [Anatomy of a flop: Why Trump's US-China phase one trade deal fell short \| PIIE](https://feedsoft.ai/events/48475-anatomy-of-a-flop-why-trump-s-us-china-phase-one-trade-deal-fell-short-piie.md) | -2.3% | -2.3% |
| CORN | 2017-04-25 | [Farm Bill Primer: Trade and Export Promotion Programs - EveryCRSReport.com](https://feedsoft.ai/events/71479-farm-bill-primer-trade-and-export-promotion-programs-everycrsreport-com.md) | +2.1% | +4.1% |

## Sources

- piie.com: https://www.piie.com/blogs/trade-and-investment-policy-watch/scrapping-nafta-will-sink-peso-and-expand-trade-deficit

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Data from Feedsoft AI (https://feedsoft.ai/). For information only; not investment advice.