In general, a strong local currency is considered to be not good for American expats (assuming that the currency is pegged to the US dollar) because it means staying that country becomes more expensive as the local currency gains value.
This is even more unfortunate for the case of Mexico, which is one of the favorite destinations among US tourists due to its proximity and relative diversity. Lately, the Mexican peso seems to have risen in value faster than most currencies in the region. This could present some disadvantages for the economy when it comes to tourism.
Earlier this week, the Mexican peso got a three-week-high value on speculations of slower job losses in the United States, the country's largest trading partner (obviously). It rose for the third straight day, the longest streak it had ever since December 15, and also the highest value since the same date. This was after a report showing that the US cut the fewest jobs since March 2008.
The peso is now recoreded to be at 12.7811 per US dollar, representing a 0.2 rise from 12.8111 per dollar the previous day. Last December 17, the peso is valued to be at 12.7591, the strongest value since that day.
According to experts, the Mexican peso is among the most undervalued currencies in the region. It is only now that the peso is catching up from the laggish performance it had made in the past.
While this is still considered to be a minimal rise, it still represents a long-term trend among dollar-pegged currencies in the future. There will be currencies that become too strong for anyone's good, and of course, the Western tourists will not be happy about it, leading to less income coming in from tourism. As I've said time and time over again, currency is a double-edged sword. What we actually need right now is more stability.
