Mexico Inflation Rises More Than Expected in Early September–Update

Nasdaq 9/25/2015

MEXICO CITY–Mexico’s consumer prices rose more than expected in early September, although annual inflation hit a new low, giving room to the Bank of Mexico to hold rates unchanged at record-low levels. The consumer-price index increased 0.32% in the first half of September, lowering 12-month inflation to 2.53% from 2.59% at the end of August, the national statistics agency said Thursday. The data came in above the 0.28% median estimate of 15 economists polled by The Wall Street Journal. Consumer prices rose more than expected in the first two weeks of September mainly due to increases in non-food goods, which suggests the heavy depreciation of the peso in recent weeks is starting to impact some prices by making imports more expensive.

The peso reached a fresh new low against the U.S. dollar in early trading Thursday. In the last year, it has lost around 23% of its value against the greenback.

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Mexican Peso Tumbles to Weakest Level Since 1993 Redenomination

03/10/15 Bloomberg 

mexican pesosMexico’s peso fell to a record low on speculation U.S. interest-rate increases will diminish the appeal of higher-yielding emerging-market assets as the drop in oil prices dims the outlook for foreign investment. The peso slid 0.4 percent to 15.5424 per dollar at 9:073 a.m. in New York after reaching 15.6271, past the record set in March 2009 when a global recession throttled export demand along with inflows from remittances, tourism and investment. The pricing data go back to 1993, when the government of then President Carlos Salinas de Gortari redenominated the currency to create the so-called nuevo peso.

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Mexico’s Peso Declines to Weakest Since February on Fed Concern

09/29/14 Bloomberg

financeMexico’s peso dropped to its lowest in almost eight months as concern the U.S. Federal Reserve will raise interest rates next year overshadowed optimism that changes in the Latin American nation’s energy laws will boost growth. The currency fell 0.4 percent to 13.4990 per U.S. dollar at 1:26 p.m. in Mexico City, the weakest on a closing basis since Feb. 3. The peso has lost 3.9 percent since June, which would mark the biggest quarterly decline since June 2013. “The Fed trumps all,” Eduardo Suarez, a foreign-exchange strategist at Bank of Nova Scotia, said in a telephone interview from Toronto. “There’s a general risk-off movement.”

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Mexico edging Canada in neighbourhood rivalry

Photo by Guanatos Gwyn
Photo by Guanatos Gwyn

Financial Times, 5/27/14

Two countries, both linked to the US economically and geographically.

But in a battle between the currencies of Canada and Mexico, it is the peso which many analysts favour.

They are not overly negative the Loonie, per se. As Citi points out, rate cut fears have abated as inflation steadies; the country has “recently shifted to a fiscal surplus, a first since 2008”; net foreign buying of Canadian equities is at cyclical highs.

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Mexico Peso Posts Weekly Decline Amid Energy Law Rules Impasse

currency - coinsBloomberg, 4/11/14

Mexico’s peso posted its biggest weekly drop since January as the country’s political parties wrangled over rules for opening up the energy industry, fueling concern that so-called secondary laws may be delayed. The currency weakened 0.3 percent this week to 13.0425 per dollar according to data compiled by Bloomberg. It was the biggest weekly slump since Jan. 24 after the peso rose 0.2 percent today.

While analysts surveyed by Bloomberg had forecast that the peso would gain an emerging-market best 3.6 percent this year as growth in Latin America’s second-biggest economy quickened, the currency is little changed this year as expansion flounders. Juan Bueno, a lawmaker from the opposition National Action Party, known as the PAN, said in an interview this week that his party hadn’t yet reached an agreement with President Enrique Pena Nieto’s government on oil regulators

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Mexican peso at crossroads between reform rally, Fed taper

financeReuters, 7/18/2013

For those who like volatility, there’s money to be made on the Mexican peso. It could rally on the hopes of a more robust future for Latin America’s second-biggest economy. Or it might get hammered by U.S. Federal Reserve policy moves. Maybe both will happen in the next six months.

While other regional economies are suffering from China’s slowing demand for commodities, Mexico is humming along. Factory exports to the United States are seen picking up and a series of economic reforms has investors seeing a brighter future.

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Mexico Peso Falls as Europe Bailout Delays Stokes Growth Concern

Bloomberg, 07/16/2012

Mexico’s peso fell after a German court said it would take more than eight weeks to rule on the euro-area’s permanent bailout fund, fueling concern that the region’s debt crisis will take longer to be resolved.

Speculation that slowing global growth will hurt the market for Mexican exports helped make the peso Latin America’s worst- performing major currency in 2011.

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