dinsdag 30 mei 2017

Peso Pounded As Political Risk Re-Emerges In Mexico

The Mexican peso tumbled more than 1% this morning, more than every other major emerging-market currency except the South African rand. Bloomberg reports that traders were anticipating a victory for the opposition Morena party in this weekend’s gubernatorial elections in the state of Mexico, according to Win Thin, Brown Brothers Harriman & Co.’s head of emerging markets in New York. And the peso is back at one-week lows...


Peso also hurt by negative sentiment towards emerging markets, as South African President Jacob Zuma quashed a revolt in his own party, denting optimism a more market-friendly leader will take over...


While hot money floods into EM bonds and stocks, Thin notes "Markets got a wake-up call with regards to EM political risk with South Africa, and may be re-pricing chances of a negative outcome from this coming weekend’s state of Mexico elections"....