### Dollar Could Stabilize Following Government Transitions in Mexico and the US
**Tijuana, August 12, 2024** — Economic experts are optimistic that the exchange rate for the Mexican peso will stabilize by the end of the year, following the conclusion of governmental transitions in both Mexico and the United States. Economist Carlos Hernández pointed out that the current fluctuations are temporary and primarily due to the electoral periods in both nations.
“These are temporary movements. We’re in an election period in both Mexico and the United States, which creates uncertainty. We estimate that by the end of the year, the Mexican peso will recover and perform well,” Hernández assured.
In Tijuana’s currency exchange houses, the dollar is currently trading around 18.30 pesos, although the official rate listed in the Diario Oficial de la Federación (DOF) on Monday was 18.83 pesos. This stabilization comes after last week’s spike, when the dollar exceeded 19 pesos due to international market instability and concerns about a potential economic recession in the United States.
Hernández explained that such devaluation is normal at the end of a presidential term and during a federal government transition. “There is global confidence that the Mexican government has managed its finances prudently, so no drastic devaluation is expected,” he said.
He also cited rising unemployment in the United States as a factor contributing to fears of a recession, which could impact not just Mexico, but economies worldwide.
Despite the temporary financial turbulence, the economic determinants in Mexico, such as inflation, remain under control. Therefore, local market turbulence is viewed as minor. The current exchange rate benefits the tourism sector in Tijuana, as tourists find better value for their dollars.
### Secondary Article: Global Factors Affecting the Exchange Rate
**Economic Context and Exchange Rate Trends**
While local factors play a significant role, global economic conditions also significantly influence the exchange rate. Recent reports highlight that the Federal Reserve’s monetary policy and interest rate adjustments are being closely monitored by economists and international markets. These policies impact investor confidence and capital flows, which in turn affect currency values.
Financial analysts have pointed out that the recent increase in interest rates by the Federal Reserve aimed to curb inflation has also contributed to the strengthening of the dollar. However, this has complex repercussions, including higher borrowing costs and potential slowing down of economic growth in the U.S., which investors are wary of.
**Impact of Global Commodities Market**
Additionally, fluctuations in global commodity prices, such as crude oil, have a direct impact on the exchange rates of oil-exporting countries like Mexico. As a major oil exporter, any significant changes in oil prices can lead to corresponding adjustments in the value of the Mexican peso.
**Trade Policies and Agreements**
Trade policies and international agreements continue to play a pivotal role. The ongoing discussions and changes in trade agreements between major economies, including adjustments in tariffs and import/export regulations, can create ripples in currency markets. Such policy changes often lead to temporary volatility as markets adjust to new conditions.
**Forecasts and Market Sentiment**
Overall, while temporary fluctuations are expected, many financial experts remain positive about long-term stabilization. They recommend businesses and investors to focus on long-term trends rather than short-term volatility, and to stay informed through credible financial forecasts and market analyses.
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