Puerto Vallarta Weather Report
Welcome to Puerto Vallarta's liveliest website!
Contact UsSearch
Why Vallarta?Vallarta WeddingsRestaurantsWeatherPhoto GalleriesToday's EventsMaps
Sign up NOW!

Free Newsletter!

Puerto Vallarta News NetworkBusiness News 

Latam Currencies Lose Steam Following U.S. Data
email this pageprint this pageemail usSamantha Pearson & Michael O'Boyle - Reuters
go to original
July 08, 2010

Today the data came out fine, but this is not enough to say that we are out of the woods. The market will remain volatile.
- Ramon Cordova
Sao Paulo/Mexico City - Latin American currencies largely gave up early gains on Thursday after strong U.S. data and a stronger outlook for worldwide economic growth failed to calm lingering fears over the global recovery.

The Mexican peso firmed as much as 0.5 percent after the United States reported that fresh claims for national unemployment benefits fell more than expected last week.

Mexico's fragile recovery from the financial crisis is largely dependent on U.S. growth, since Mexico sells the vast majority of its exports to its northern neighbor.

But the early optimism quickly faded.

"Today the data came out fine, but this is not enough to say that we are out of the woods. The market will remain volatile," said Ramon Cordova, a trader at brokerage BASE in Monterrey, Mexico.

A string of unemployment, housing and production data over recent weeks from the United States has suggested the recovery of the world's biggest economy is faltering.

By the middle of the session, the Mexican peso was only 0.1 percent stronger at 12.8255 per U.S. dollar.

Latin American currencies had strengthened early in the session after the International Monetary Fund upgraded its 2010 global growth forecast, prompting a tentative return to the region's higher-risk assets.

Brazil and Chile's currencies also gave up early gains and traded weaker.

After closing in the previous session at its strongest level in about two months, the bid quote for the real weakened 0.34 percent to 1.771 per U.S. dollar.

The Chilean peso lost 0.31 percent to 536.90 per dollar as the price of copper, the country's main export, reversed early gains.

Investors also remained cautious after the European Central Bank said on Thursday it expects the euro zone's economic recovery to be moderate and uneven in pace.

The IMF also warned that Europe's debt problems pose a big risk to recovery.

"Despite raising this year's growth forecast, the institution didn't rule out that the global recovery could be at risk from here onwards because of worries over European sovereign debt, fiscal adjustments in other developed countries, and the weakness of the U.S. housing market," wrote analysts at Brazil's Bradesco bank.

(Additional reporting by Jean Luis Arce in Mexico City; Editing by Leslie Adler)

In accordance with Title 17 U.S.C. Section 107, this material is distributed without profit to those who have expressed a prior interest in receiving
the included information for research and educational purposes m3 © 2009 BanderasNews ® all rights reserved carpe aestus