Mexican leftist casts shadow over Mexican banking convention

3/25/2017 Reuters

Andres_manuel_lopez_obrador_oct05Mexican financiers and politicians blasted populism at a top banking conference this week in a thinly veiled attack on the frontrunner for the 2018 presidential election – but some worry they overdid it and may have played right into his hands.

The chosen theme of the annual meeting at the beach resort of Acapulco was “liberalism versus populism,” with President Enrique Pena Nieto, senior ministers, former U.S. Treasury Secretary Larry Summers and ex-Secretary of State Colin Powell among the grandees squarely lined up on one side.

Without a voice but very much on the lips of the Mexicans was Andres Manuel Lopez Obrador, a leftist former Mexico City mayor and twice presidential runner-up whose relentless campaigning has put him in contention to go one better in 2018.

Lopez Obrador’s broadsides against corruption and inequality sting a Mexican political establishment tainted by allegations of graft, even as U.S. President Donald Trump’s populist jabs at Mexico have generated some sympathy for Pena Nieto at home.

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Mexico seeking opportunities to tap debt markets

3/24/2017 Reuters

4350685550_dbd28c7e50Mexico is closely looking for windows of opportunity to issue more debt and improve its loan portfolio, Finance Ministry Undersecretary Vanessa Rubio said in an interview on Thursday.

Mexico last week announced a new $3.15 billion 10-year bond issue, its first transaction in the dollar bond market this year. This follows a bounce in emerging market assets following relatively dovish talk by Federal Reserve head Janet Yellen.

“Our debt issuances in international debt markets have been highly valued and we’re not obligated to issue any more because our debt requirements have been met,” Rubio told Reuters on the sidelines of a banking conference in the seaside-resort city Acapulco. “Still, we’re monitoring market conditions to see if there are windows of opportunity to take advantage of to improve our position.”

Mexican issuers had stayed clear of the dollar market in 2017 as heated rhetoric over U.S. President Donald Trump’s trade policies pummeled both the peso and debt prices.

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Mexico vulnerable, but outlook improving – finance minister

3/23/2017 Reuters

jose antonio meade
Source: Eneas De Troya/Flickr

Mexico’s economy may face further volatility, but the outlook for the country is less gloomy, Finance Minister Jose Antonio Meade said on Thursday.

“We are not exempt from seeing and living a period of great volatility, but the scenarios are becoming more contained,” Meade told local radio.

The Mexican peso slumped to a record low in January on concerns that U.S. President Donald Trump could rip up a free trade deal with Mexico, but it has recovered as the country’s northern neighbor has taken a more conciliatory tone.

The recovery in the peso from its January low will help inflation cool back toward policymakers’ 3 percent target, central bank chief Agustin Carstens said on Wednesday.

Data on Thursday showed Mexico’s annual inflation rose to 5.29 percent in early March, its fastest pace in nearly eight years, and Carstens said in a radio interview on Thursday that policymakers had some room to continue raising interest rates.

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Mexico inflation rises at fastest pace in nearly eight years

3/23/2017 Reuters

carstensMexican annual inflation rose at its fastest pace in nearly 8 years in early March, prompting central bank chief Agustin Carstens to hint at higher interest rates to combat an inflation “bubble” he said would subside later in the year.

The headline inflation rate for the year through mid-March was 5.29 percent MXCPHI=ECI, the national statistics institute said on Thursday. The figure was the highest since the second half of February 2009, and was above expectations of economists polled by Reuters for 5.25 percent.

Mexico’s central bank raised its benchmark interest rate last month to a nearly eight-year high after a steep hike in gasoline prices and weakness in the peso sparked by Donald Trump’s election as U.S. president.

Just after the data was published, Carstens said the central bank had room to continue adjusting rates.

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Mexico Populist Steals Investor Spotlight as Nafta Woes Ease

3/21/2017 Bloomberg

AMLOThe calm that’s settled over Mexico trading is at risk of getting upended.

With White House officials saying they’re confident a trade deal can be reached to benefit both Mexico and the U.S., the peso has regained more than half of the losses it saw after Donald Trump’s victory pushed it to record lows. Talks aren’t expected until late this year, allowing investors to turn their attention to the next big risk for the Latin American country: a presidential win by opposition candidate Andres Manuel Lopez Obrador, known as Amlo.

Early polls show him in the lead or second place, but investors see a more reliable test of his prospects coming in June elections for the governorship of the State of Mexico, where his Morena party is vying to oust President Enrique Pena Nieto’s PRI for the first time ever. A win for Morena would be a wake-up call for investors who have become too complacent and could send the peso tumbling 10 percent, according to Nomura Holdings Inc.

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U.S. Homeland Security seeks proposals for wall with Mexico

3/18/2017 Reuters

500px-US_Department_of_Homeland_Security_Seal.svgThe U.S. Department of Homeland Security has issued requests for proposals for prototypes for a wall along the Mexican border, saying ideally it should be 30 feet (9 meters) high and the wall facing the U.S. side should be “aesthetically pleasing in color.”

A wall to stem illegal immigration was one of Donald Trump’s main campaign promises and has been highly controversial. The president has vowed to make Mexico reimburse the United States for its cost but Mexico has repeatedly said it will not do so.

Earlier this week, the White House requested $3 billion more for Homeland Security, with some of that intended for planning and building the border wall.

According to one document posted online by U.S. Customs and Border Protection Friday night, the wall should be 30 feet high, built using concrete, and “physically imposing.” However, it says designs over 18 feet (5.5 meters) high could be acceptable.

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Mexico to redo open season energy auction hit by ‘problems’

3/16/2017 Reuters

energy - oil barrelsMexico has postponed an auction of part of state oil company Pemex’s excess capacity for transport and fuel storage due to “methodological problems”, the Energy Regulatory Commission (CRE) and Pemex said in a joint statement late on Wednesday.

The auction is aimed at allowing new participants to enter the recently opened fuel market, as Mexico moves away from an energy industry dominated by former state-owned monopolies and draws up new rules for the more open energy markets.

The auction for excess capacity in the northeastern states of Sonora and Baja California will be redone before the end of March and companies that had prequalified for the initial auction will be allowed to participate, the statement said.

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