Mexican peso slides after Trump's 25% tariff threat

LONDON, Jan 21 (Reuters) - Mexico's peso weakened by more than 1% against the dollar in early European trade on Tuesday, after President Donald Trump threatened 25% tariffs on Mexico and Canada as soon as Feb. 1.

The peso MXN= hit 20.78 by 801 GMT, steadily rising toward the 20.94 level the currency had touched on Jan 17, which was its weakest versus the dollar since July 2022.

The peso has been heavily impacted by proposed policies from newly inaugurated U.S. President Donald Trump - particularly his plans for trade tariffs.

(Reporting By Libby George, editing by Karin Strohecker)

((Libby.George@thomsonreuters.com; +44 07527 061331; Reuters Messaging: libby.george@thomsonreuters.com))