Mexico is locked in a bitter war of words with Donald Trump after refusing to pay for the border wall that was the crown jewel in his presidential campaign.
The country’s currency has been badly hit over the billionaire’s threats to tax money sent home by migrants and rip up a free trade agreement in a bid to fund a fortified border.
As Trump bounded toward victory, the peso plunged 13 percent in its biggest fall in 22 years. It then pared losses to trade down 8.9 percent at 19.95 per dollar.
Analyst Gabriela Siller of Mexican bank BASE said: “Very hard times are coming to Mexico.”
Ratings agency Fitch said Trump’s victory increased economic uncertainty for Mexico and may add downside risks to economic growth.
Analysts said the peso had been able to recover from its record low after Trump took a measured tone in his victory speech and did not invoke any of his threats against Mexico.
President Enrique Pena Nieto said on Twitter he was ready to work with Trump, calling the neighboring countries friends who “should continue to work together for the competitiveness and development of North America”.
But Mexican Foreign Minister Claudia Ruiz Massieu said on Wednesday the country’s government would not pay for Trump’s proposed wall along the U.S. border.
Trump’s threat that Mexico will pay for the wall had become a key feature of his stump speeches.