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joanne

What's the Mexico with almost 20 pesos to the USD like?

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When I last lived there we got 10.5 pesos to the USD. I'm sure prices on virtually everything have increased considerably since then, but am curious to know just how everyday life has changed with such a good conversion rate.

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Some things are more expensive than NOB, and some are less. Gasoline is more expensive here, papayas are less expensive. Imported items are still more expensive. Rent still cheaper, as is electric (if you don't have a lot of electric things). Prices are expected to rise significantly in January, so now is the time to get roof repairs, painting, etc. if you own a house.

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9 hours ago, joanne said:

When I last lived there we got 10.5 pesos to the USD. I'm sure prices on virtually everything have increased considerably since then, but am curious to know just how everyday life has changed with such a good conversion rate.

Of course, if your money is in a US or Canadian bank and you take out money here via ATM as needed, you rise with the tide.  Some prices are the same, like for rentals, because demand has always been less than supply.

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The peso isn't the only currency having problems with the dollar, keep that in mind.  Look at the Euro, the British Pound and the Canadian Loonie to name a few.  

This has happened before in my experience.  I remember traveling in Europe like a king and buying everything in sight about 40 years ago when the dollar soared for a reason I can't remember now.  It is also about oil here.  Of course the current exchange rate makes Mexican goods MORE competitive not less.  And Mexico is running far lower deficits than the U.S.  At some point this will correct, particularly if the Mexican government raises the Cete rate.  That was 8 percent when we moved here, 4 percent now.

In terms of what it will buy here the Peso most certainly has not lost 50 percent of its purchasing power.  Imported stuff is expensive but Mexican products and labor are a great deal less affected, at least for now.

Maybe this situation will force the Mexican government to clean up its act somewhat, particularly as related to corrupt and grossly inefficient entities like Pemex.

 

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Gasoline now cost roughly $2.60 a gallon in dollar in Mexico vs $2.33 in the USA =>  about 11% higher in Mexico.

Mexican Beers cost about $1 USD.

Beef round costs about half of US costs (at $2.30 a lb in Mexico).

Eggs cost about $1.25 USD.

Official measures comparing Chapala with Colorado say most things in Chapala are much cheaper:
 

Indices Difference Info
Not enough data to calculate difference in Consumer Prices
Not enough data to calculate difference in Consumer Prices Including Rent
Rent Prices in Chapala are 85.83% lower than in Fort Collins, CO
Restaurant Prices in Chapala are 71.90% lower than in Fort Collins, CO
Groceries Prices in Chapala are 69.49% lower than in Fort Collins, CO

 

http://www.numbeo.com/cost-of-living/comparison.jsp

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On 9/25/2016 at 0:59 PM, joanne said:

When I last lived there we got 10.5 pesos to the USD. I'm sure prices on virtually everything have increased considerably since then, but am curious to know just how everyday life has changed with such a good conversion rate.

When we moved down in July of 2007, the peso exchange with the US dollar was about 10.5, as best I recall. How the current exchange rate affects someone living here depends several things:

1) Does your landlord set your rent in pesos or in US dollars?  If it's in pesos, you are doing great. If dollars, not so great, but if you are from the US, and get your money from there, it probably doesn't make much difference. A dollar is a dollar.

2) Do you buy lots of imported goods at the store (especially from the US)? If so, the price is likely much higher than even a few months ago. If you stick to non-imported purchases, your exchanged US dollars will go much further. 

3) Do you eat out at restaurants a lot? I have noticed that prices in many restaurants have significantly increased. However, since my dollar exchanges for a lot more pesos, I'm actually paying (translated into dollars) pretty close to what I was paying in 2007.

4) Are you trying to sell a house here? If you have priced it in US dollars, then you may eliminated a lot of possible Mexican purchasers, even those that are affluent. This happened to a good friend, who has been told by Mexican folks coming over from Guadalajara that they can't possibly pay--in pesos--the dollar price she is asking.

So, like I say, it depends.

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1 hour ago, bigd said:

I am wondering if everyone who has a maid has increased there pay 50%?/???

I remember various posters earlier this year or last saying they were doing this. Has it continued ??

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We've been told since we got here that we NOB types way overpay.  Now we're not paying enough?  The main costs that have gone up are imported goods which we ourselves limit & I'm sure our helpers do the same.

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Better question: has any Mexican worker ASKED for a raise due to peso devaluation.

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I recall a recent article about some new auto plants opening up in Mexico.  The starting pay cited for these places was about half what we pay our maid and gardener.  

This inbalance in currencies, which affects not only the Peso but other major currencies as well, is temporary in my view.  The general cost of living here is not being much affected.  The most inflationary things around here in my experience are restaurants and our own thoroughly incompetent local government which just announced another 10 percent tax rise for this year, three times the rate of inflation.

 

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