Mexican Sand
The Mexican economy has the advantageous location of being close to most consumers. Therefore, any change in consumer demand have almost immediate and visible impact on the health of the Mexican economy. The health of the economy, of course affects the value of the currency, which in this case is the Mexican peso. With the onset of recession in the U.S., demand for exports in the Mexican economy declined and with it the peso has lost nearly 18% of its value.
The sharp drop in exports caused to swell the budget deficit and taxes have reduced the need for increased spending to stimuli. 80% of exports Mexico are the United States and whose consumption of the wrinkle of the United States because of the crisis, Mexico has been hit hard by the recession. Given the risk of falling export leading to a restricted economy, Mexico experienced a decline in its credit rating from Standard and Poor's and Fitch.
Sensitivity Mexican peso in the state of the American economy emerges from the heavy losses Published by weight and the stock markets of Mexico due to lower housing U.S. starts Wednesday and retail U.S. December. In effect, this means that the state of the U.S. economy not as good as appeared to be and demand Mexican exports may not be as expected. Thus, the Mexican economy can not experience the expected growth and declining stocks of Mexico and the weight is a reflection of that.
The Mexican economy is the dependence of the U.S. economy It is obvious that no less than 7% due to the recession in the U.S. 2009. So this left the cheaper peso nearly 18%, stocks of Mexico also fell. Both the Mexican peso and stocks seem to have a chance worthy of investment. The Mexican stock market index is around 8% discount on the Bovespa in Brazil, has traded at a premium in the past. This clearly indicates there may be an opportunity waiting to be exploited.
The sudden and rapid peso and stock markets in the country indicate that one of the entries in one of These two must be at the right time as buying is the lowest point. Thus, the profit booking can be done on the positive side, the real growth potential could be in the wait and see approach as more income tend to be related to a strong recovery of the U.S. economy, which can still take some time.
The fate of the Mexican economy is also linked to oil prices is crude oil exporting countries more important. Revenue from crude oil exports finance about 38% of the national budget. Oil prices steady around $ 79 a barrel This adds a certain increase in the Mexican economy. However, a strong U.S. recovery is what ultimately boost the economy Mexico and its currency and stocks. Thus, the negative peaks in both the Mexican peso and stocks seem to have an opportunity worthy of assessment about this time.
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Pete is a freelance article writer, link builder, article marketing expert, and a seo freelancer specialist.
