Mexicos Peso Falls to Eight-Week Low Amid Inflation Concerns
Mexicos peso dropped to an eight- week low against the dollar and local-currency bonds fell on expectations inflation quickened last month.
The peso fell as much as 0.6 percent today before a report that is expected to show consumer prices rose 0.44 percent last month, the biggest increase in seven months, according to the median forecast of 16 economists in a Bloomberg survey. Accelerating inflation decreases the value of peso-denominated assets.
The inflation number today is going to look pretty bad, said Raul Rodriguez, head of economic analysis at Mexico City- based brokerage Vector Casa de Bolsa SA. Rising local prices prompt investors to move out of peso-denominated assets.
More : bloomberg.com
Currency Strategists: BNP Says Mexico's Peso May Fall
The Mexican peso, up 4.5 percent versus the dollar this year, will drop in 2006 as the central bank cuts its benchmark interest rate amid slowing inflation, said Rafael de la Fuente, chief economist for Latin America at BNP Paribas SA.
The peso has dropped 1.4 percent since the central bank lowered its key rate by a greater-than-expected half a percentage point to 8.25 percent on Dec. 9, the fifth reduction since August. Mexico's currency may also decline on concern lower rates will reduce the yield advantage of domestic bonds.
``We still
Mexico's Bolsa Falls for Week on Profit Concerns: Latin Stocks
Mexico's Bolsa index fell, heading for a second straight weekly decline, on concern that earnings growth may slow and the government may become less favorable to investors after this year's election.
Mexico's Bolsa fell 319.21, or 1.7 percent, to 18,199.12 at 2 p.m. New York time, and has fallen 3.6 percent for the week. Cemex SA, the world's third-largest cement maker, led today's decline. Brazil's Bovespa rose 92.96, or 0.3 percent, to 36,975.27, paring its decline for the week to 0.8 percent.
``You are starting to see opinions that emerging
Mexico stocks rise as Bernanke mum on inflation
Mexican stocks gained 1.2 percent on Friday and the peso fell for a fourth straight day after a speech by U.S. Federal Reserve Chairman Ben Bernanke made no mention of inflation or monetary tightening pressures.
The benchmark IPC stock index < .MXX> closed up 243.49 points at 20,994.94, while the peso lost 0.47 percent to end at 10.9715 per dollar.
The stock market was down 0.25 percent on the week, but still up a robust 17.93 percent in the year-to-date.
More : today.reuters.com
Mexico's Peso Declines to 2-Week Low on Rate Cut Expectations
Mexico's peso fell to a two-week low on expectations that the coutnry's central bank this week will cut interest rates for a third time in three months.
The peso has declined 1.6 percent in five days ahead of the Bank of Mexico's Oct. 14 policy meeting. The bank has cut the overnight lending rate twice since August to 9.25 percent, a half percentage point from a 29-month high of 9.75 percent. Rising yields in the U.S. are also contributing to the peso's weakness, said Suhas Ketkar at RBS Greenwich Capital
Mexico 1-month T-bill yield rises to 7.02 pct
The yield on Mexicos benchmark 28-day Cetes, or T-bills, edged up 1 basis point to 7.02 percent on Tuesday amid expectations of rising U.S. interest rates.
Longer-term Cetes yields ticked up from last week at a central bank auction, along with rates on Mexicos 3-year and 7-year peso from when they were last auctioned on May 16.
The yield on the three-month bill rose to 7.36 percent from 7.28 percent last week, while the yield on the six-month yield rose to 7.63 percent from 7.50 percent.
The 3-year peso bond rose to a yield of 8.50
UPDATE 1-Mexico 28-day T-bill yield falls to 7.92 pct
The yield on Mexico's benchmark 28-day Cetes, or T-bills, dropped six basis points to 7.92 percent on Tuesday as investors saw the central bank cutting interest rates further despite an uptick in inflation.
The rate on 90-day Cetes fell 12 basis points to 7.84 percent while the yield on six-month paper dropped 11 basis points to 7.77 percent.
An earlier Reuters survey of Cetes dealers had predicted the 28-day Cetes rate would fall eight basis points to 7.90 percent and that longer-term T-bill yields would also fall.
The yield on the 5-year peso-denominated bond
Mexico Sells 20-Year Peso Debt to Yield 9.7 Percent (Update1)
Mexico, the nation with Latin America's biggest economy, paid its lowest borrowing cost since April 2004 at a government auction of 20-year peso-denominated bonds on speculation the central bank will lower interest rates as inflation slows.
Mexico sold 2 billion pesos ($189 million) of 10 percent peso bonds that mature in December 2024 for a price of 1.0259 centavos on the peso. At that price, the bonds yield 9.7 percent, the lowest for a 20-year bond since 9.67 percent on April 15, 2004.
``Money is tight and inflation has gone down
Mexico Fixed-Rate Bond Yields to Rise on Inflation, Moreno Says
Mexico's fixed-rate peso bond yields may rise in 2006 as the inflation rate climbs from a record low, said Salvador Moreno, chief economist at ING Groep NV's Mexican unit.
The yield on fixed-rate bonds may rise as much as 30 basis points, or 0.3 percentage point, as higher-than-expected consumer price increases drive down already ``tight'' valuations, Moreno said. The annual inflation rate may climb as high as 3.9 percent in January, more than the 3.5 percent expected by many fund managers, he said.
``There's a risk that inflation expectations rise
Mexico's Inflation Rate Drops to Record Low in August (Update1)
Mexico's annual inflation rate fell to the lowest on record in August, adding to expectations that the central bank will cut the benchmark lending rate for a second straight month.
Inflation in the 12 months through August slowed to 3.95 percent, the lowest rate since the central bank began keeping records in 1969, from 4.47 percent in July. The monthly inflation rate dropped to 0.12 percent from 0.39 percent in July as the cost of cars and vegetables such as tomatoes and avocados fell.
``Inflation has been declining consistently and
Mexicos Stock Index Falls on Political Concern: Latin Stocks
Mexicos stocks fell for a third day on concerns a Felipe Calderon administration would lack support in Congress to pass legislation opening the energy industry to private investment and keeping the budget balanced.
The Bolsa index fell 136.30, or 0.7 percent, to 19,563.85 as of 3:56 p.m. New York time, led by Wal-Mart de Mexico SA, Latin Americas largest retailer. Elsewhere in the region, Brazils Bovespa rose 403.66, or 1.1percent, to 36,544.30.
Mexicos Bolsa last week rose the most in three months after a second vote tally from the July 2
