Mexican Currency Rises Amid Improved Economic Growth Prospects
Mexico’s peso gained for the first time in three days amid signs of improving growth in Latin America’s second-biggest economy.
The currency appreciated 0.4 percent to 12.7158 per U.S. dollar at 9:36 a.m. in Mexico City, extending its rally in January to 1.1 percent.
Barclays Plc raised today its outlook for Mexican economic expansion in 2013 to 3.5 percent from 3 percent, citing in a research note “the surprising strength of Mexico’s latest activity data.” The government said on Jan. 24 that Mexico’s economy grew 4.14 percent in November from a year earlier, compared with a 3.10 percent median forecast in a survey of analysts by Bloomberg.
“Mexico’s economy finished 2012 expanding at a steadier pace than we had expected,” Barclays analysts Sebastian Brown, Marco Oviedo and Bruno Rovai wrote in the note.
The peso will appreciate to 12.5 per dollar by March, a level last seen in September 2011, fueled by stronger-than- expected trade data, Barclays projects.
Home prices in U.S. cities rose in November by the most in six years, boosting the outlook for the Latin American country’s biggest trading partner.
The S&P/Case-Shiller index of property values increased 5.5 percent in November from a year earlier, the biggest gain since August 2006. a report indicated today.
The yield on Mexico’s peso-denominated bond due in 2024 dropped five basis points, or 0.05 percentage point, to 5.19 percent, according to data compiled by Bloomberg. The price rose 0.49 centavo to 142.62 centavos per peso.
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