Futures Market News
Peso prone to bounce back and appreciate this quarter, central bank chief says
Jul 05, 2012 11:24 AM
Inflation will slow this quarter and the economy's growth might not climb as high as forecast and even Latin America's most traded currency faces the prospect of increasing in value, the central bank chief of Mexico told Bloomberg during an interview.
The Mexican peso might advance close to 12 per dollar, where the monetary unit was during the first two quarters of last year, Governor Agustin Carstens said on Wednesday, noting his commentary was not part of an official forecast.
"I wouldn’t be surprised if certain scenarios present themselves, we could see exchange rates close to that level," the governor told the news source. "Given that we have no structural problems in the financial system, you would think the peso has room to appreciate."
The rough patch that the economy and the peso encountered during the past three-month period was linked to the sovereign debt crisis in the euro zone and the aversion against riskier assets, he said.
The Wall Street Journal reports questions are rising about the newly elected president's ability to build a consensus in Congress. One losing candidate is prepared to explore legal channels to challenge election results, the news source reports.
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