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Trump talked about Mexico — but this time, the peso jumped

The Mexican peso strengthened against the U.S. dollar Wednesday as President Donald Trump appeared to take a softer stance against Mexico.

"I think traders are looking at U.S.-Mexico relations and getting the sense that it can only improve from here," said Adam Button, currency analyst at ForexLive.com.

On Wednesday, Trump signed an executive order directing construction of a long-promised wall along the U.S.-Mexico border. But the president stopped short of some of his more inflammatory comments about Mexico.

"We also understand that a strong and healthy economy in Mexico is very good for the United States. Very, very good. We want that to happen," Trump said in remarks at the Department of Homeland Security.

US dollar vs Mexican peso year-to-date

Source: FactSet

"By working together on positive trade, safe borders and economic cooperation, I truly believe we can enhance the relation between our two nations to a degree not seen before in a very, very long time," he said. "I think our relationship with Mexico is going to get better."

The Mexican peso gained more than 2.3 percent against the U.S. dollar to trade just around 21 pesos against the greenback. Earlier this year, the peso hit a record low against the dollar and is still about 0.9 percent weaker against the dollar for 2017.

"Today he signed the order to build the wall, but he never talked about a tax on Mexico, increasing the fees on visas. He's not reiterating Mexico is the one that's going to pay for it," said Andres Jaime, global FX and rates strategist at Barclays.

"A lot of people think that one of the main cards that Mexico has comes from securing the south border," with Central America, Jaime said. "People think if Trump continues to be harsh with Mexico, the one card Mexico could play is we're not going to cooperate with securing the south border."

Net migration from Mexico to the United States reached zero in 2012, meaning that as many Mexicans leave the United States as enter it. Job growth in Mexico has been widely credited for that reversal. But illegal immigration from Central America, usually through Mexico, has continued.

Ahead of Mexican President Enrique Pena Nieto's meeting with Trump for next week, Mexican Foreign Minister Luis Videgaray and Economy Minister Ildefonso Guajardo are talking with top Trump officials in Washington Wednesday and Thursday.

"They're setting the stage for what could be constructive talks," said Thierry Albert Wizman, global interest rates and currencies strategist at Macquarie.

"We've probably seen the peak in dollar-[peso]," Wizman said. He expects the currency cross to hover around 21 as "obviously not all the worry is out of the way."

— CNBC's Patti Domm and Reuters contributed to this report.