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The Mexican peso hit its strongest level since the US election on Tuesday morning, as the dollar’s recent slide continued to benefit emerging market currencies.

Donald Trump’s pre-election promises to tear up free trade agreements and build a wall on the US-Mexican border battered the Mexican currency, but it has recovered as the new administration’s softened its rhetoric.

The peso has been the best-performing currency in the world since the start of the year, strengthening 9.2 per cent. It climbed a further quarter of a percentage point on Tuesday morning, to 18.95 per dollar.

South Africa’s rand – a close second behind the peso in terms of return so far this year – also strengthened further this morning. The currency was up 0.27 per cent at publication time, to a fresh 19-month high of 12.5970 per dollar.

The dollar has been falling since the Federal Reserve’s “dovish” rate hike last week, boosting emerging markets currencies across the board.

Israel’s shekel is 0.18 per cent stronger on the day, hovering near the 2-year intraday high hit yesterday, while the rouble, lira and rupee also made gains.

Copyright The Financial Times Limited 2017. All rights reserved.
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