Donald Trump’s style of negotiating with Mexico is focused on a transactional relationship, noted Intercam Casa de Bolsa.

At the same time, ING considers that Trump tends to seek market turmoil and create volatility as part of his pressure to negotiate.

Donald Trump’s style of negotiating

Intercam noted that in Trump’s inaugural speech and following his announcement that he would sign hundreds of executive orders, the bulk of them were aligned with what Intercam considers to be the biggest issue in the United States: migration. 

And although the implications in the case of mass deportation are considerable in economic and social terms, Intercam said it is still unaware of the magnitude and rigidity of the application of laws that could lead to very different scenarios.

It is also worth noting that Trump did not explicitly mention tariffs against Mexico, although a few hours later, he reiterated his plans to impose 25% tariffs on Mexico and Canada, arguing the migration and fentanyl crisis. And that remains a big question mark in the short term.

Bilateral relationship

Intercam considered that what happened on Monday, and the fluctuation of the exchange rate, is possibly a small sample of what is expected in the short term in the relationship between Mexico and the United States. With that it is possible to infer that there will be volatility, contrasting positions and many questions. 

“However, in the background, it seems to us that they give a small sample of who Donald Trump is and what he is looking for in his relationship with Mexico: a transactional relationship,” said Intercam.