Feb. 24 (Bloomberg) -- Mexico’s peso headed to a weekly drop as better-than-forecast U.S. economic data failed to offset concerns domestic demand may be faltering in Latin America’s second-biggest economy.
The peso weakened 0.3 percent to 12.8635 per U.S. dollar at 9:56 a.m. in Mexico City, from 12.8220 yesterday. The currency has slid 0.8 percent this week, paring its 8.3 percent rise in 2012.
“You’ve seen an awful lot of positives on the U.S. side, but, you also saw some very curious retail sales numbers in Mexico in December,” Enrique Alvarez, the head of Latin America fixed-income research at IdeaGlobal, said by phone. “December was very weak on a number of fronts, so there may be some considerations related to the strength of the overall start of the year period domestically, aside from the export factor.”
Mexican retail sales rose 3.5 percent in December from the same month the previous year, the government said on Feb. 22, compared with a median forecast of a 4.1 percent increase in a Bloomberg survey.
Purchases of new homes in the U.S. exceeded economists’ forecasts in January and a gauge of consumer confidence in the world’s biggest economy topped estimates.
Mexico’s economy will expand 3.5 percent this year, compared with 3.9 percent in 2011, central bank Governor Agustin Carstens said yesterday at an event in Mexico City. Mexico sends about 80 percent of its exports to the U.S.
The yield on peso-denominated debt due in 2024 rose one basis point, or 0.01 percentage point, to 6.53 percent, according to data compiled by Bloomberg. The price fell 0.1 centavo to 129.99 centavos per peso.
--Editors: Glenn J. Kalinoski
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