Mexico’s peso rose the most this year as U.S. reports showing a pickup in retail sales and a drop in jobless claims boosted prospects for the Latin American nation’s top export market.
The currency appreciated 1.1 percent to 12.7856 per U.S. dollar at 10:58 a.m. in Mexico City, the biggest advance on a closing basis since Dec. 31. The peso’s rally today pushed it higher for 2013.
The peso has tumbled 4.8 percent in the past month on speculation the Federal Reserve will pare record monetary stimulus if the world’s largest economy shows sustained evidence of a sustained economic recovery.
“More than anything else, despite the volatility and uncertainty in financial markets, the connection with the U.S. has significant impact over economic activity in Mexico,” Rafael Camarena, an economist at Grupo Financiero Santander Mexico SAB in Mexico City, said in a telephone interview.
Retail sales in the U.S., the destination for about 80 percent of Mexico’s exports, increased 0.6 percent in May, the the biggest gain in three months. U.S. jobless claims in the U.S. dropped by 12,000 to a lower-than-forecast 334,000 in the week ended June 8 from 346,000 in the prior period.
Yields on peso bonds due in 2024 fell 14 basis points, or 0.14 percentage point, to 5.28 percent, according to data compiled by Bloomberg. The price rose 1.50 centavos to 140.62 centavos per peso.
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