Bloomberg News

Mexico’s Peso Climbs as U.S. Housing Data Signals Better Exports

January 17, 2013

Mexico’s peso climbed to the strongest level since March after builders in the U.S., the biggest buyer of the Latin American nation’s exports, broke ground on more houses than forecast.

The peso rose 0.4 percent to 12.5696 per U.S. dollar at 7:51 a.m. in Mexico City, after earlier touching 12.5609 per dollar, the strongest intraday level since March 14. The currency has advanced 2.2 percent in 2013, the most among the dollar’s 16 most-traded counterparts.

Housing starts climbed 12.1 percent last month to a 954,000 annual rate, exceeding all forecasts in a Bloomberg survey of economists and the most since June 2008, the Commerce Department reported today in Washington. Signs of stronger economic growth in the U.S. typically boost the peso, as Mexico sends about 80 percent of its exports to its northern neighbor.

The housing figure was “incredibly high,” Roberto Galvan, a currency trader at Intercam Casa de Bolsa SA in Mexico City, said in a telephone interview. “The mood in the market remains positive.”

A separate report from the Labor Department showed U.S. applications for jobless benefits decreased by 37,000 to 335,000 in the week ended Jan. 12, the lowest level since the period end Jan. 19, 2008.

Yields on peso bonds due in 2024 rose one basis point, or 0.01 percentage point, to 5.43 percent, according to data compiled by Bloomberg. The price fell 0.10 centavo to 140.01 centavos per peso.

To contact the reporter on this story: Jonathan J. Levin in Mexico City at jlevin20@bloomberg.net

To contact the editor responsible for this story: David Papadopoulos at papadopoulos@bloomberg.net


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