Incoming Mexican government has little room for error: adviser

11/16/2018 – Reuters

REUTERS/Henry Romero

NEW YORK (Reuters) – An adviser to Mexican president-elect Andres Manuel Lopez Obrador sought on Thursday to reassure investors in New York, following weeks of upheaval in Mexican financial markets and doubts about the policies of the incoming left-leaning government.

Abel Hibert, an economic adviser to Lopez Obrador, acknowledged that financial markets were watching closely.

“We recognize that we have one opportunity to show responsibility in the elaboration of the next budget,” Hibert said to a crowd of investors at a business forum in New York.

“The design of the public budget will be very careful,” he said. “We don’t have room for mistakes.”

Markets were shook in recent weeks by announcements from the incoming administration that it would cancel a partly-built $13 billion Mexico City airport and limit bank commissions.

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Mexico central bank sends warning over incoming leftist government

11/16/2018 – Reuters

Photo by Negative Space on Pexels.com

MEXICO CITY (Reuters) – Mexico’s central bank raised its benchmark interest rate on Thursday on concerns over inflation, and said the incoming government’s policies risked fanning inflation in a strongly worded warning to President-elect Andres Manuel Lopez Obrador.

The bank said another rate hike was possible.

The Bank of Mexico lifted its overnight interbank rate MXCBIR=ECI by 25 basis points to a nearly 10-year high of 8.0 percent, as expected by economists. It was a divided decision, with one member calling for a 50-point hike.

Mexico’s peso and the stock market have been rattled by concerns Lopez Obrador’s administration will move away from the orthodox fiscal policies advocated by the central bank.

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Mexico to Hold Another Referendum, This Time on New Train

11/13/2018 – The New York Times

By the Associated Press

MEXICO CITY — Mexico’s president-elect said Monday he will hold another public referendum later this month on his proposal for a railway to connect the main tourist attractions across the Yucatan peninsula.

Andres Manuel Lopez Obrador said during a trip to the Yucatan state capital of Merida that the public can vote on the train and nine other proposed projects and programs Nov. 24 and 25.

A referendum last month cancelled Mexico City’s new $13 billion airport that was already one-third completed.

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AMLO Shockwaves Spread for Mexico Investors Wary of Policies

11/09/2018 – Bloomberg

By Eric Martin

Mexican President-elect Andres Manuel Lopez Obrador and his allies are quickly showing that they’ll put the people over business interests — even if it risks jarring investors.

The country’s stocks, bonds and currency plunged Thursday after the Senate leader for Lopez Obrador’s Morena Party introduced a bill to eliminate certain fees and commissions charged by banks. While such a move would be welcome in many corners of the country, it came as a surprise to a business community that was already reeling from the president-elect’s decision 11 days ago to scrap a $13 billion airport project.

The politician known as AMLO has always somewhat unnerved investors with his leftist agenda, but the latest actions by him and his party have left them wary of what comes next. After taking smiling photographs with executives in the first four months of his presidential transition, Lopez Obrador in the past two weeks has challenged them like no other leader in recent memory.

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BBVA shares stumble on fee limit proposal in Mexico

11/09/2018 – Reuters

MADRID, Nov 9 (Reuters) – Shares in Spanish bank BBVA fell on Friday after a senator from the Mexican president-elect’s party unexpectedly proposed stopping banks from charging certain commissions, deepening fears about the leftist’s economic policy.

BBVA has been relying on Mexico, which is its biggest market and accounts for 41 percent of its overall profits, to offset worsening economic conditions in Turkey and an ongoing squeeze on lending activity in Spain.

“Incoming president (Andres Manuel Lopez) Obrador had previously indicated a more business-friendly approach than the market initially feared, but this proposal will likely increase jitters once more that his policies may prove more interventionist in nature,” Jefferies said in a note.

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Mexico stocks plunge on ruling party bank commissions plan

11/08/2018 – Reuters

Nov 8 (Reuters) – Mexico’s banking stocks plunged on Thursday, after a Mexican senator from the president-elect’s party released a bill proposal that would prohibit or curb banks from charging commissions for certain services.

Mexico’s S&P/BMV IPC index was down more than 2 percent, with shares in Grupo Financiero Banorte down more than 11 percent. Santander and Gentera both dropped more than 7 percent.

The new shock to markets by the incoming government comes after president-elect Andres Manuel Lopez Obrador announced on Oct. 29 that he would scrap a $13 billion airport project, pummeling stocks and the peso.

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Party of Mexico’s president elect wants legalized marijuana

MEXICO CITY — The party of Mexico’s president-elect has submitted legislation to legalize marijuana possession, public use, growing and sales.

Sen. Olga Sanchez Cordero presented the measure Thursday, saying that “every person has the right to carry up to 30 grams (one ounce) of cannabis.”

Cordero has been picked as interior secretary by President-elect Andres Manuel Lopez Obrador, who takes office Dec. 1.

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