Gypsy Jan
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Mexico's Peso Rebounds, Closes Stronger Against U.S. Dollar
From The WALL STREET JOURNAL
By Anthony Harrup October 11, 2012
MEXICO CITY--"Mexico's peso recovered lost ground against the U.S. dollar Thursday, supported by gains in local stocks and bonds and by a positive
U.S. weekly jobs report early in the day.
The peso was quoted closing in Mexico City at MXN12.9125 to the U.S. dollar, according to Infosel, compared with MXN12.9485 at Wednesday's close.
The currency weakened the previous session for what analysts and traders said were technical reasons, as participants had built up large speculative
long peso positions in the past month. The rebound started with the U.S. Labor Department's report that first-time unemployment claims fell sharply
last week to their lowest level in four years.
While U.S. equities gave up their opening gains, Mexico's benchmark IPC stock index held on to close 0.7% higher, and local government bonds rose,
pushing yields lower across the curve.
Bank of America Merrill Lynch said in a report that it sees the peso as undervalued, and favors long positions, but prefers trading it against the
Canadian dollar or the Chilean peso because of its high global exposure.
"Both, the Brazilian real and the Colombian peso are subject to intervention by monetary authorities, while the Chilean peso is more exposed to trade
flows, and the Mexican peso is the only regional currency that is deliverable and fully convertible, making it the favorite vehicle of global
investors." BofAML said."
Write to Anthony Harrup at anthony.harrup@dowjones.com
“Travel is fatal to prejudice, bigotry, and narrow mindedness.”
—Mark Twain
\"La vida es dura, el corazon es puro, y cantamos hasta la madrugada.” (Life is hard, the heart is pure and we sing until dawn.)
—Kirsty MacColl, Mambo de la Luna
\"Alea iacta est.\"
—Julius Caesar
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bajadave1
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ten to one
Be sure to let us know when it hit's 10 to 1
 spingrin:
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Pescador
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Six month projections show it to hit 14-1 again in November.
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thebajarunner
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More of a comment on our lousy US economy than on a strong Mexican economy.
Four more years of you know who and it will be back to one on one
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DENNIS
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It's 12.86 now and has been hovering around that mark for a while. That doesn't reflect any big rebound as I see it.
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DENNIS
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The price of imported goods, things that we like to see in the stores, to consumers will fluctuate right along with the peso. If it goes to 14-1, the
prices on the shelf will rise. Costco and Walmart will have a robust price changing crew around the clock....not to mention Auto Parts etc.
Prices go up, but rarely go down so in the long run, the consumer eats it.
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thebajarunner
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The big loser- the common folk of Mexico
| Quote: | Originally posted by DENNIS
The price of imported goods, things that we like to see in the stores, to consumers will fluctuate right along with the peso. If it goes to 14-1, the
prices on the shelf will rise. Costco and Walmart will have a robust price changing crew around the clock....not to mention Auto Parts etc.
Prices go up, but rarely go down so in the long run, the consumer eats it. |
There are some brief times where we Gringos will benefit from a devaluing peso, but as Dennis correctly points out, they even out in a hurry.
Not so for the common man of the country.
It is heartbreaking to see the impact on the local folks, whilst we might benefit for a few days at best.
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DENNIS
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| Quote: | Originally posted by thebajarunner
Not so for the common man of the country.
It is heartbreaking to see the impact on the local folks, whilst we might benefit for a few days at best. |
You're right, Dick. It's hard to watch. I have three people working for me on a part time basis and I give them COLA raises regularly. Not a lot,
but enough to keep a balance in their wages [from me anyway] and my self respect.
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