Mexico Peso Drops as Slower U.S. Job Growth Damps Export Outlook
Mexico’s peso tumbled as U.S. employers hired fewer workers than forecast in March, hurting prospects for the Latin American nation’s top export market.
The peso fell 0.6 percent to 12.3740 per U.S. dollar at 7:26 a.m. in Mexico City, after earlier touching 12.4 per dollar, the weakest intraday level since March 27. The drop pared the peso’s decline this week to 0.4 percent. It is still up 3.8 percent in 2013, the most among 16 major dollar counterparts tracked by Bloomberg.
Payrolls in the U.S. grew by 88,000 workers, the smallest gain in nine months and less than the most-pessimistic projection among 87 economists surveyed by Bloomberg, Labor Department data showed today in Washington. The median forecast called for a 190,000 gain. Mexico sends about 80 percent of its exports to the U.S., its northern neighbor and partner in the North American Free Trade Agreement.
The peso “is responding to the non-farm payrolls data,” Roberto Galvan, a currency trader at Intercam Casa de Bolsa SA, said in a telephone interview from Mexico City. “No one in the market expected this.”
Yields on Mexico’s peso bonds due in 2024 fell five basis points, or 0.05 percentage point, to 4.91 percent today, within three basis points of the March 13 record low, according to data compiled by Bloomberg. The price rose 0.59 centavo to 145.29 centavos per peso, the data show.
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