BajaNomad

Peso prices pegged to the Dollar or ???

kevin_in_idaho - 1-21-2017 at 10:32 AM

I'm curious what people are seeing in Baja. Are the peso prices of items going up to keep the US dollar price the same or can we actually get more purchasing power with our dollar?

For instance. If a fish taco was 1USD a year ago (12 pesos?), is that same fish taco now 22 pesos or is it still 12? I could see it making a difference if you are paying in dollars vs. pesos but if prices are listed in pesos are they changing them daily?

I'm just curious. I've been to a lot of countries and some of them have 2 separate prices; local and tourist.

woody with a view - 1-21-2017 at 10:38 AM

if it says 12 pesos use pesos. pretty simple.

David K - 1-21-2017 at 10:46 AM

Small shops, taco stands have the prices in both currencies often posted, with the peso amount being actually cheaper to the American who bought pesos at the border.

In other words.
A fish Taco may be one dollar or 20 pesos posted
If you bought your pesos this week, you would get maybe 22 pesos for that dollar. Use the pesos, pay 20 for the taco.
If you use dollars in Baja, that 'dollar' taco just became a 22 peso taco in actual value.

At Pemex stations, it is pretty close but still is offset for them to process the dollars. So while I bought pesos at 20 per dollar (at the border, almost 4 weeks ago), the Pemex stations posted that they were taking dollars at the rate of 19.00 per dollar.

motoged - 1-21-2017 at 10:59 AM

Quote: Originally posted by David K  
Small shops, taco stands have the prices in both currencies often posted, with the peso amount being actually cheaper to the American who bought pesos at the border.....


David, with all due respect, I cannot recall ever seeing a double price list at a taco stand or at small shops.....

David K - 1-21-2017 at 11:01 AM

Not all, just often you will see both prices on menus... especially with the peso dropping so rapidly in value recently.

bajaguy - 1-21-2017 at 11:09 AM

You are over thinking things........"always"* use pesos in Mexico/Baja. Get your pesos from the ATM's in/at banks. The exchange rate favors you

*YMMV

kevin_in_idaho - 1-21-2017 at 11:14 AM

Quote: Originally posted by bajaguy  
You are over thinking things........"always"* use pesos in Mexico/Baja. Get your pesos from the ATM's in/at banks. The exchange rate favors you

*YMMV


That's our plan. Can you get them on either side of the border? We're going in via Caliexco/Mexicali east.

AKgringo - 1-21-2017 at 11:28 AM

I agree with Bajaguy and Woody, local vendors are aware of the exchange rate, and unless they are stashing dollars as an inflation hedge, they will have to pay to exchange them at the bank. I have not found a situation where it was an advantage to use dollars, although it may happen somewhere.

I don't know if the situation has changed, but back in late November and early December, I could not exchange dollars for pesos at the bank in Mulege, or Loreto. It was also limited exchanges with a debit card at the ATMs, so don't wait until you need more pesos to do the exchange!

AKgringo - 1-21-2017 at 11:38 AM

Kevin, you might want to ask your local banks if they have pesos on hand. I started my trip by getting 6000 pesos (all they had) at a local Wells Fargo in a small town in northern CA.

Did I get the best exchange rate? Who care's, it was convenient, gave me more options about where and when to get additional cash, and was an insignificant expense compared to the rest of the trip.

vandenberg - 1-21-2017 at 12:42 PM

Get pesos before you cross and use credit card where ever possible They get you the best exchange rate. Tell your bank you're in Mexico.t

David K - 1-21-2017 at 12:59 PM

Quote: Originally posted by kevin_in_idaho  
Quote: Originally posted by bajaguy  
You are over thinking things........"always"* use pesos in Mexico/Baja. Get your pesos from the ATM's in/at banks. The exchange rate favors you

*YMMV


That's our plan. Can you get them on either side of the border? We're going in via Caliexco/Mexicali east.


Several on the right in Calexico before the border. I used the one that shares an auto parts store parking lot.

Alm - 1-21-2017 at 02:06 PM

Quote: Originally posted by kevin_in_idaho  
I'm curious what people are seeing in Baja. Are the peso prices of items going up to keep the US dollar price the same

I'm curious whether this is the first inflation your ever saw. Welcome to the club then. Prices are going up on imported items since those are purchased and priced in the US. There can be a delay, vendors not always can or want to jack prices up immediately. Old stock can be sold at the old prices.
Quote: Originally posted by kevin_in_idaho  

If a fish taco was 1USD a year ago (12 pesos?), is that same fish taco now 22 pesos or is it still 12?

Peso/dollar inflation pulls local items into this orbit too. Some more, some less. Taco could be local but taco stand and the car pulling this stand are likely US made and USD priced when purchased. Also, don't know whether you heard about it, there was a recent steep increase in gas prices - this ALWAYS leads to higher cost of local items.

Quote: Originally posted by kevin_in_idaho  
if prices are listed in pesos are they changing them daily?

See above.
Quote: Originally posted by kevin_in_idaho  

I've been to a lot of countries and some of them have 2 separate prices; local and tourist.

Mexico is less prone to this double-price game, being physically close to the US, but it does happen.

[Edited on 1-21-2017 by Alm]

Sweetwater - 1-21-2017 at 03:50 PM

Quote: Originally posted by AKgringo  
Kevin, you might want to ask your local banks if they have pesos on hand. I started my trip by getting 6000 pesos (all they had) at a local Wells Fargo in a small town in northern CA.

Did I get the best exchange rate? Who care's, it was convenient, gave me more options about where and when to get additional cash, and was an insignificant expense compared to the rest of the trip.


I just got a standard exchange through a local bank that charged 5%. Effective exchange rate was 20.4 p/USD which seems more than reasonable. Remember that you'll get the daily rate minus fees if you withdraw from an ATM, credit cards have more fees, debit cards have less fees has been my experience. Single charges to a Credit card haven't done well for me in the past, Cash is king and I like starting a trip that has been prepaid to some extent.

motoged - 1-21-2017 at 05:41 PM

What I don't understand is why folks think their home country currency should be accepted by vendors outside their country. Saving a percentage point here and there might make sense on paper, but sure doesn't when you offer a US $20 for 2 tacos at a small stand at night that doesn't even have a float to change a $500MP.

When travelling, have a few 100$$$'s of home currency in local currency....and don't expect banks to always exchange your home currency....Bancomer, for instance, won't change US $$$ to pesos unless you have an account with them.

It's kind of arrogant to expect other countries to work the way your own does....running out of local currency means you are either broke or haven't planned very well.

woody with a view - 1-21-2017 at 07:09 PM

Ged, I doubt my local taco shop in Sandy Eggo would accept Loonies, much less Pesos......

David K - 1-21-2017 at 07:30 PM

We don't Ged, it is Mexico that makes the rules for Mexico. For as long as I can remember, everyone in Baja takes and uses dollars and not because we Americans have any problem using Pesos. In markets, hundreds of miles south of the border, locals use dollars to buy things. In Baja, at least, it is a dual currency region. If Mexico won't take them anymore, then we all can exchange our money at the border, just like we do when traveling to other countries.

mtgoat666 - 1-21-2017 at 07:36 PM

Quote: Originally posted by motoged  
What I don't understand is why folks think their home country currency should be accepted by vendors outside their country. Saving a percentage point here and there might make sense on paper, but sure doesn't when you offer a US $20 for 2 tacos at a small stand at night that doesn't even have a float to change a $500MP.

When travelling, have a few 100$$$'s of home currency in local currency....and don't expect banks to always exchange your home currency....Bancomer, for instance, won't change US $$$ to pesos unless you have an account with them.

It's kind of arrogant to expect other countries to work the way your own does....running out of local currency means you are either broke or haven't planned very well.


Some places in Mexico take dollars. It's like that in many countries. US dollar is a global currency.
Things are changing a bit as Mexico tries to clamp down on the cash economy and tax more transactions,... and Mexicano has lately tried to make it more diffucult to bank in dollars,...

motoged - 1-21-2017 at 07:37 PM

Quote: Originally posted by woody with a view  
Ged, I doubt my local taco shop in Sandy Eggo would accept Loonies, much less Pesos......



Eggxactly !!!

AKgringo - 1-21-2017 at 07:39 PM

For what it is worth, the last time I drove north on the Alaska Highway, I was able to use my excess Canadian currency at a Carr's grocery store (owned by Safeway) in Anchorage. I am pretty sure I got a full rate of exchange, but not positive

bajaguy - 1-21-2017 at 08:55 PM

I believe your best exchange rate (remember, YMMV) is using a debit card. The exchange rate is set by your card issuer (VISA or Mastercard) not your bank or the Mexican bank

If you use a US bank that has a working relationship/partner agreement with a Mexican bank, you may avoid ATM fees or be reimbursed for ATM fees.

There are some US banking institutions that reimburse all ATM fees (Charles Schwab for one)

Just remember when you use the cash exchange businesses in the US or in Mexico, even though they advertise no commissions, they are making money on your transaction and you will not get the best rate (see ATM use above).

I have used Mexican bank ATM's for many a year with no problems, and my bank (USAA) reimburses ATM fees.

Banks are all over Mexicali and there is probably an ATM in the Customs/Immigration building where you will be getting your FMM

One note....BBVA Bancomer has the highest ATM rates of any bank in Mexico

Another note........You also might want to get a US credit card with no International fees......such as a Chase.Southwest Airlines VISA

Quote: Originally posted by kevin_in_idaho  
Quote: Originally posted by bajaguy  
You are over thinking things........"always"* use pesos in Mexico/Baja. Get your pesos from the ATM's in/at banks. The exchange rate favors you

*YMMV


That's our plan. Can you get them on either side of the border? We're going in via Caliexco/Mexicali east.


[Edited on 1-22-2017 by bajaguy]

Hook - 1-21-2017 at 09:08 PM

Quote: Originally posted by vandenberg  
Get pesos before you cross and use credit card where ever possible They get you the best exchange rate. Tell your bank you're in Mexico.t


This is more than semantics. Don't use a CREDIT CARD, use a DEBIT CARD.

Many ATMs will take a CREDIT CARD, but that is basically a cash advance with big fees from your own bank. Then, the intl transaction fees, the Mexican bank ATM fees are added on top of that. There might not be a worse way to obtain pesos, except maybe a Thomas Cook at a mall or something.

My MIL foolishly had her local Chase branch obtain pesos for her in Colorado, before she came down. I remember the exchange rate, when it was all said and done, was about 15-20% less than the going rate at an ATM. It was highway robbery.

As I've mentioned before, many of the big supermarkets like Walmart, Sorianas, Ley, Mega give really fair exchange rates for using dollars. They can process them easily and it encourages gringos to shop there. It is often right at the best exchange rate I can get at an ATM. They change it daily, to keep it close.

Ged, the dollar is like no other currency in the world. It is accepted in many other countries; actually welcomed by many Mexican businesses, because it holds it's value so well. Not so with the peso or the loonie.

We have tourist shops, marinas, etc. that post prices in dollars only. Supposedly, that's illegal, but they have done it for YEARS, with no repercussions. If they priced in pesos, they would have to be changing prices all the time, to cover the goods they originally obtained in dollars, anyway.

vandenberg - 1-22-2017 at 07:51 AM

Hook, I'm not talking about using credit card for ATM use, but for restaurants and store purchases. The exchange rate is the same as stated daily by exchange houses and you get the rate of the previous day. And you get your 11/2% for using your card. Usually even better than paying in pesos.

Hook - 1-22-2017 at 08:42 AM

True. I misunderstood.