The link between oil and the Mexican peso is weakening. This has firms like BNP Paribas SA warning the nation’s bond market could suffer, bloomberg.com reports.
While Mexico’s fortunes have long been tied to the price of oil, that relationship has eroded as some investors sell the currency to hedge against global risks, including Britain’s possible exit from the European Union, said Banorte Ixe. So even as crude has climbed 7 percent since the end of April, the peso has plummeted 8 percent.
The slumping peso prompted BNP Paribas SA to say June 17 that there’s “considerable” risk that overseas holders of longer-term government bonds called Mbonos may begin to dump the securities. They’ve already chopped their holdings of short-term debt to the lowest since 2009 and an exodus from Mbonos would be a problem for Mexico because foreigners own 42 percent of them.
“People are throwing in the towel,” said Alvaro Vivanco, the head of local markets strategy at Banco Bilbao Vizcaya Argentaria SA. “A lot of real-money foreign investors are becoming frustrated with Mbonos because of the performance of the peso.”
more recommended stories
Yucatán national leader in avant garde technological solutions
Scientific staff will learn to market.
Fake photo brings out real issues
Social media users began circulating a.
As he continues leading the polls, AMLO has surrounded himself with mainstream economists
Mexican front runner presidential candidate Andrés.
Rate President Donald Trump’s Job Performance
Newsmax.com, America’s leading independent news service,.
Mérida, among the 10 best cities for doing business: “Entrepeneur”
During the present municipal administration Mérida.
Trump told Shinzo: “I can hand you over ’25 million Mexicans’ to give you a taste of the migration problem”
President Donald Trump reportedly made some.
Mérida breaks ground for the new “Litoteca Nacional de Yucatán”
MÉRIDA, Yuc.- The inauguration ceremony of.
New Companions And Fun Time In Video Chat
If you are willing to find.
The Hermitage of San Dieguito in Tekax
Built 373 years ago, according to.
Mobile App Development: Step-by-Step Guide
What does it take to bring.