Donald Trump's immigration policies and a surging Mexican peso threaten to reduce crucial dollar inflows to Latin America's second-largest economy. Remittances - mostly from Mexican workers in the U.S. - reached a record $63 billion last year, representing Mexico's largest source of foreign income ahead of oil exports and tourism.

Analysts warn Trump's proposed migrant crackdowns could directly curb cross-border money transfers if fewer workers reach the U.S. Meanwhile, the Mexican peso has gained 10% against the dollar since late 2023, making each dollar sent home worth fewer pesos. This double squeeze comes as remittances account for over 4.2% of Mexico's GDP.

Economists note reduced remittances could pressure consumer spending and weaken growth projections. The peso's strength, while helping curb inflation, creates headaches for families relying on dollar conversions. Mexico's central bank may face tougher monetary policy decisions balancing currency stability with economic support needs.