Bloomberg News

Mexico’s Peso Slumps After Retail Sales Drop by Most Since 2010

February 21, 2013

Mexico’s peso fell after a report showed that retail sales fell in December by the most in three years, damping the growth outlook in Latin America’s second- biggest economy.

The peso dropped 0.3 percent to 12.7671 per U.S. dollar at 8:43 a.m. in Mexico City, paring its advance this year to 0.7 percent.

The national statistics agency said today that Mexico’s retail sales fell 1.8 percent in the final month of 2012 from the year-earlier period, the biggest annual drop since the country was emerging from recession in January 2010. Today’s slump follows a 0.8 percent slide yesterday, when Federal Reserve minutes indicated a debate over further U.S. stimulus dimmed the outlook for growth in the biggest market for Mexican exports.

“Disappointing retail sales have boosted the Mexico peso’s negative trend started by the Fed minutes,” Eduardo Suarez, a Latin America foreign-exchange strategist at Bank of Nova Scotia, said in an e-mailed response to questions from Toronto.

The yield on Mexican local-currency bonds due in 2024 fell one basis point, or 0.01 percentage point, to 5.09 percent, according to data compiled by Bloomberg. The price increased 0.16 centavo to 143.57 centavos per peso.

To contact the reporter on this story: Ben Bain in Mexico City at bbain2@bloomberg.net

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


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