Querétaro Reports Various Effects of the Dollar’s Depreciation

Industry representatives in Querétaro have observed the various effects caused by the peso’s exchange rate against the dollar; these effects have been both positive and negative. And while the devaluation of the U.S. dollar is impacting exporters, it has also created an opportunity for profit in import operations.

For Alfredo Sahagún Sánchez, president of the National Chamber of the Manufacturing Industry (Canacintra) in Querétaro, this duality ensures stability for companies, without the exchange rate causing any serious conflict.

“Of course, Mexican companies that buy in dollars benefit, while those that export face a contradiction. (…) The dollar is at that exchange rate; it’s losing value globally—it’s not because of Mexico, it’s not because of inflation, and it’s not because we’re dealing with some other situation. We believe that its current value, for both importers and exporters, has been a common factor for several months now. I think the stability is still good,” he said.

The president emphasized that although the sectors with the largest market share have been more vulnerable, they still purchase raw materials in dollars, so imports and exports are working to maintain a balance.

“[...] globally, the dollar is losing value, and that has consequences for the whole world, not just for Mexico,” said the Canacintra leader. The industry has estimated that, once the U.S. elections are over, the dollar's trend could change.

Fluctuations in the dollar have fallen below the 17-peso mark, affecting companies that must adjust their exchange rates, according to Cuauhtemoc Acevedo Toledo, president of the Association of Industrial Micro, Small, and Medium-Sized Enterprises of Querétaro (Amiqro). The devaluation of the U.S. currency allows for a profit margin based on a previous exchange rate, so it has both positive and negative effects.

“The exchange rate allows us to negotiate any kind of deal for any project. If the dollar rises—since all our inputs generally come from abroad, in terms of raw materials—it affects us and we have to adjust our prices, (...) a drop in the dollar’s value, which is reflected in our suppliers’ prices, allows us to maintain a margin if a previous price had already been set,” he said.