Ever wondered why the Mexican peso sometimes seems to defy expectations in the face of global turbulence? If you keep an eye on the dolar peso hoy movements, you might have heard people mention remittances—those billions sent home by workers in the US—as a key factor. But does the relentless flow of dollars from the north really tip the exchange rate scales? And if so, how does that actually work in practice? Drawing on my own experience tracking the market, regulatory filings, and some honest trial and error, let me walk you through how remittances shape the dollar-peso dynamic in ways that surprise even seasoned analysts.
Short answer: Yes, but not always in the way you’d expect. Let’s break down why. When Mexican families receive dollars from relatives working in the US, those dollars usually get converted to pesos to pay for groceries, rent, or even local investments. Theoretically, this creates a steady demand for pesos and extra supply of dollars, which should, according to simple supply-demand logic, strengthen the peso.
But here’s where things get interesting: the effect isn’t always immediate or linear. In my own attempts to forecast short-term FX moves using remittance data, I’ve had mixed results. Sometimes a surge in remittances coincides with a stronger peso, but other times bigger macro events—think US interest rate hikes or Mexican political news—completely overshadow the remittance flow.
Still, the size of remittances is impossible to ignore. According to Banco de México’s latest data (Banxico Remittances Table), Mexico received over $61 billion USD in 2023—more than foreign direct investment or oil exports! That’s a tidal wave of dollars washing into local banks and forex dealers.
Let me take you through what this looks like on the ground. Say my cousin in Los Angeles sends $500 through a service like Western Union. On the receiving end in Mexico, the payout is usually in pesos. Here’s the real kicker: the money transfer operator (MTO) or the local bank needs to exchange those incoming dollars for pesos, usually via the interbank market.
I once tried to test this myself by comparing different MTOs—sometimes I got a noticeably better rate at local banks that handled large remittance volumes, compared to smaller outlets. According to the OECD, this process, multiplied by millions of transactions, steadily increases the demand for pesos and helps support its value.
But don’t get me wrong—this upward pressure is gradual and easily swamped by panic selling or global shocks. For example, in March 2020, despite record remittance inflows, the peso still plunged when investors rushed to the dollar amid COVID uncertainty (Reuters, April 2020).
Let’s look at a real scenario. In early 2020, remittances into Mexico hit all-time highs as migrant workers tried to support family through tough times. I remember checking Banxico’s daily exchange rate and being shocked—the peso was still tumbling, hitting over 25 MXN per USD. Why? The global “dash for cash” meant everyone wanted dollars, so even those billions from remittances couldn’t prop up the peso.
It’s a good reminder: while remittances provide a consistent source of dollar inflows, their impact can be drowned out by bigger forces. Yet, analysts at BBVA Research argue that without those remittances, the peso’s slide would have been even worse. Their econometric models suggest remittances trim some volatility, but don’t reverse major trends.
From conversations I had with a former Banorte FX dealer, the process is more mechanical than most people think. When remittance inflows spike near Mother’s Day or Christmas, local banks see a brief uptick in dollar supply. Some banks hedge their exposure in advance, buying pesos forward to avoid sudden rate swings.
But even insiders admit: remittances are a steadying force, not a magic bullet. If the US Federal Reserve raises rates sharply, global investors yank money out of emerging markets—including Mexico—regardless of remittance flows.
| Country | Remittance Law/Regulation | Legal Basis | Supervisory Authority |
|---|---|---|---|
| Mexico | Ley para la Transparencia y Ordenamiento de los Servicios Financieros | Official Gazette | Banco de México, CNBV |
| USA | Remittance Transfer Rule (Regulation E, Subpart B) | CFPB | Consumer Financial Protection Bureau |
| EU | PSD2 (Payment Services Directive 2) | EU Law | European Banking Authority |
What’s striking is how Mexico’s approach is tightly linked to its monetary stability. Banxico even publishes daily remittance data and watches for signs these flows could impact FX reserves (Banxico Remittance Reports). In contrast, the US and EU treat remittances more as consumer protection issues—ensuring transparency and fair pricing for senders and receivers.
I once sat in on a webinar with Gabriela Siller, head economist at Banco BASE. She argued, “Remittances act like a soft cushion for the peso, but they can’t break a fall if the global market is in freefall.” Her charts showed that during periods of calm, remittance spikes can nudge the peso stronger. But when global risk appetite shifts, that effect fades fast.
She also pointed out that remittances are often used as collateral for local loans, indirectly boosting domestic consumption and thus economic activity—another subtle way the flows shape the peso’s longer-term resilience.
So, what’s the bottom line? Watching the dolar peso hoy is a bit like reading a weather forecast: remittances are a steadying, reliable breeze, but hurricanes (like global market panics) overwhelm them. If you’re trying to predict short-term moves, don’t overestimate the power of remittances alone. But for long-term peso stability, they’re absolutely essential.
My own lesson: always track both the macro headlines and the monthly remittance reports from Banxico. And if you’re sending money or trading FX, shop around for banks or MTOs that handle big remittance flows—they often give you better rates, since they’re already managing a flood of currency swaps.
If you want to dig deeper, check out Banxico’s remittance dashboards, BBVA’s research, or the IMF’s remittance impact papers. And always remember—no single factor explains it all. The peso is a complex beast, but remittances are a key thread in its story.