Mexico’s Peso Slumps as U.S. Jobs Data Damps Economic Outlook
Mexico’s peso weakened as U.S. companies added fewer jobs than forecast last month, damping the economic outlook for the Latin American country’s biggest trading partner.
The peso slumped 0.1 percent to 12.2841 per U.S. dollar at 7:24 a.m. in Mexico City, paring gains this year to 4.6 percent, still the biggest rally against the greenback among the world’s 16 most-traded currencies.
The peso’s advance this year, including a 0.7 percent jump yesterday, has been partly fueled by stronger growth in the U.S., the destination for about 80 percent of Mexico’s exports. The 158,000 increase in employment last month was the smallest since October, figures from the Roseland, New Jersey-based ADP Research Institute showed today. The median forecast of 39 economists surveyed by Bloomberg called for an increase of 200,000.
“It’s sort of the combination of a good couple of sessions” and “a bad ADP number that sort of signals or indicates that the non-farm payrolls aren’t going to be as good,” Benito Berber, a Latin America strategist at Nomura Holdings Inc., said in a telephone interview from New York. “Both things sort of put pressure on the Mexican peso.”
Yields on peso-denominated bonds due in 2024 were little changed at 5 percent, according to data compiled by Bloomberg. The price fell 0.03 centavo to 144.20 centavos per peso.
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