The weak peso is devastating Laredo, Texas
One of every two retail dollars is spent by visiting Mexicans “Now, with the peso, my customers aren’t coming anymore”
Cindy Gallegos, an elementary school teacher from Nuevo Laredo, Mexico, has sticker shock while looking for lace for her wedding dress. She’s in a fabric store just over the Rio Grande, in Laredo, Texas, and the price tag is $63. “It’s too expensive,” she says. “When converting to pesos, the price is impossible.”
Surrounded by racks of dresses and colorful rolls of cloth, the store’s owner, Silvia Guerra, says: “We are dead over here. Business is dead.”
The peso is down 16 percent against the dollar in the past year, lowering the purchasing power of Mexicans visiting the U.S. All Texas border cities are feeling a pinch. State data shows sales-tax receipts down as much as 6 percent in the second quarter from
a year ago, after years of boom-time increases. But merchants in Laredo — where an estimated one of every two retail dollars is spent by Mexicans—say business is off 50 percent or more.
“We are talking about millions and millions of dollars per day that Mexicans spend in Texas,” says Roberto Coronado, an economist at the Federal Reserve Bank of Dallas. “The city that depends the most on them is Laredo.”
Some of the pain is a regular part of the ebb and flow in a slice of the U.S. economy that’s reliant on foreigners and a city that, with four international bridges, is the country’s biggest inland port. “When the Mexican peso gets a cold, Laredo sneezes,” says Les Norton, head of the Downtown Merchants Association. But today Laredo is taking two hits at once. The peso is down largely thanks