MEXICO CITY (Reuters) – Mexico and Peru’s popularity among foreign investors means they are among the emerging market economies most exposed to losses when the United States finally moves to take its foot off the monetary accelerator.
History shows that when U.S. interest rates jump – widely anticipated when the Federal Reserve begins reducing its $84 billion a month bond purchases – new foreign investment in Peruvian and Mexican financial assets drops by almost two-thirds.
MEXICO CITY (Reuters) – Brazil’s move to drop a tax on foreign buying of its domestic bonds removes a major hurdle for foreign investors and enhances the country’s appeal, a senior portfolio manager with bond giant PIMCO said on Wednesday.
Michael Gomez, co-head of emerging markets at Pacific Investment Management Co, said removing the 6 percent levy on foreign transactions was an “unequivocal positive” for Brazil, which put the tax in place to discourage speculative capital.
News just in from Brazil colleagues: FinMin Mantega says to scrap IOF tax on fixed income investments #Brazil
BRASILIA/NEW YORK (Reuters) – Brazil should further hike the rate of return on its infrastructure projects if it wants to tap into a limited pool of global capital coveted by regional peers, Mark Ramsey, head of Latin America for Macquarie Capital, said on Friday.
The Australian bank, one of the world’s biggest managers of infrastructure investments, is interested in electricity generation, road, port, airport, railway and real estate projects in Latin America’s biggest country.
May 24 (Reuters) – Latin America should suffer just a short,
sharp shock to its financial markets when the U.S. Federal
Reserve starts to taper its super easy monetary policy as
investors remain convinced of the region’s solid economic
prospects and are attracted by its high-yielding assets.
Investors are coming around to the idea that when the Fed
begins slowing the money printing presses and buys fewer bonds,
it will be because the policy has succeeded in getting the U.S.
economy to grow in a sustainable way. That growth should buoy
global demand and help sales of Latin America’s key exports.
MEXICO CITY (Reuters) – Mixed signals from the U.S. economy are clouding the growth outlook for Mexico and it needs to be ready for the shocks that could accompany a possible withdrawal of U.S. monetary stimulus, Finance Minister Luis Videgaray said on Wednesday.
Mexico’s government last week cut its growth outlook for 2013 to 3.1 percent from 3.5 percent after a soft first quarter, and Videgaray said Latin America’s No. 2 economy has been hurt by weaker U.S. demand for its exports.
NEW YORK/MEXICO CITY (Reuters) – Latin American local currency debt, both corporate and sovereign, is a good investment given the global liquidity glut has pushed up the price of U.S. dollar bonds, Lazard Asset Management portfolio manager Denise Simon said on Tuesday.
Strong demand for local debt from Mexico, Uruguay and blue-chip companies such as Mexico’s Televisa and America Movil reflect a shift towards selecting securities based on individual merit rather than a broad play on emerging markets, she said.
MEXICO CITY, May 20 (Reuters) – Mexico’s banking reform will
take two or three years to have an impact on credit and access
to financial services, said the chairman of Mexico’s largest
locally-owned bank, Grupo Financiero Banorte.
The reforms, unveiled earlier this month, aim to increase
lending in Latin America’s second-largest economy to improve
development of the small business sector and boost growth.
MEXICO CITY/RIO DE JANEIRO (Reuters) – Foreign investors flocked back to Brazil in early 2013, prompting the strongest stock market inflows in more than two years, but massive bets on share price falls suggest no change in sentiment towards Latin America’s largest economy.
Central bank data shows foreign inflows to Brazil’s stock market almost tripled in the first quarter from the previous three-month period to $7.74 billion, more than the net inflows for the whole of 2012 and the strongest quarter since late 2010.