Mexico’s core inflation rate fell to 3.41 percent in May, the lowest rate since the central bank began calculating the index in 1983. The central bank has raised the benchmark loan rate in 12 of the past 15 months to 9.75 percent. Mexico’s $677 billion economy grew 2.4 percent in the first quarter, down sharply from the previous quarter, dragged by the interest-rate increases and lowered US demand for Mexican exports.
Category: Regions
Posted inDaily Brief
Mesa Warns of Civil War
Bolivian President Carlos Mesa, who offered to resign this week, warned that the country could face civil war if new elections weren’t held immediately. By law, Senate leader Hormando Vaca Diez, is next in line for the presidency. But Mesa asked Vaca Diez to refuse the position. Congress is scheduled to meet this morning and is expected to accept President Mesa’s resignation. Protesters broke into oilfield installations in eastern Bolivia yesterday.
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Edgardo Sternberg, Latin American Debt Strategist at Loomis Sayles, joins panel for the Inaugural Cumbre Financiera Mexicana
Edgardo Sternberg will join us on the “Mexico: Emerging or Converging Market” panel at LatinFinance’s Inaugural “Cumbre Financiera Mexicana”, which will take place on July 13-14 in Mexico City. Public and private sector leaders will discuss and debate the transition of Mexico — one of only three Latin American investment grade countries — from an emerging to a “converging” market. The “Cumbre Financiera Mexicana” is a high-level and spirited debate and discussion on the ever-changing face of Mexico’s dynamic financial markets. The invitation-only event will provide a unique forum for investors, financiers, government and corporate leaders to network, analyze shared challenges, and identify new opportunities. To apply for an invitation click here.
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Bolivia: Protests Escalate
Tens of thousands of peasants and miners marched through La Paz Tuesday, a day after Bolivian President Carlos Mesa tendered his resignation for the second time in four months. Some of the protestors set off dynamite and police responded by firing tear gas and rubber bullets. For weeks demonstrators demanding a nationalization of the natural gas industry have blocked the country’s main highways and restricted access to cities, causing food and fuel shortages. Mesa promised to remain in Bolivia until Congress accepts his resignation.
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Allan Marks, Partner – Global Project Finance Group at Milbank Tweed, will be a panelist on the “Infrastructure Finance: Building The Future” workshop at LatinFinance’s Inaugural “Cumbre Financiera Mexicana” on July 13-14 in Mexico City
Public and private sector leaders will discuss and debate Mexico’s need for infrastructure development, as well as the capital market’s role in financing such projects. The “Cumbre Financiera Mexicana” is a high-level and spirited debate and discussion on the ever-changing face of Mexico’s dynamic financial markets. The invitation-only event will provide a unique forum for investors, financiers, government and corporate leaders to network, analyze shared challenges, and identify new opportunities. To apply for an invitation click here.
Posted inDaily Brief
Mexico Sells Eurobonds
Mexico sold 750 million euros ($920 million) of 10-year bonds, seeking to raise funds to pay debt due in 2006. President Vicente Fox reiterated last week he would raise enough money this year to cover $3 billion of foreign maturities due in 2006, to avoid an increase in borrowing costs stemming from concern the next president, who will be elected next year, may boost spending. Mexico last tapped the debt market on May 17 with a 250 million 7-year Swiss franc note. Barclays and UBS managed yesterday’s sale. Moody’s rates Mexico’s debt Baa, three levels above junk.
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Femsa Sells Shares
Fomento Economico Mexicano (Femsa), the world’s second-largest Coca-Cola bottler, raised about $700 million after selling 130 million shares for $5.32 each. The company will use the money to pay off debt it took on last year when it bought back a 30 percent stake in its beer unit for $1.25 billion.
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Embraer Makes Sale
Flybe, the low-cost UK airline formerly known as British European Airways, placed a firm order with Empresa Brasileira de Aeronautica (Embraer) to buy 14 Embraer 195 jets for $470 million, with the option of buying 12 more. The first of the planes will be delivered in the second half of 2006. The Embraer 195, with 118 seats, is part of a new line of jets being developed by the company to expand from the 50-seat regional jet market its shares with Canadian competitor Bombardier. Flybe is the second low-cost carrier to buy Embraer’s new jets. JetBlue, a US discount carrier, ordered 100 Embraer aircraft for $3 billion in June 2003.
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Volcan Strike Ends
Workers at Volcan Compañia Minera, Peru’s biggest zinc and lead miner, ended an eight-day strike Friday after the company granted each a one-time $300 bonus. About 2,200 workers returned to work at the Cerro de Pasco and Yauli mines in the central Andes after beginning a strike to demand 8 percent of the company’s 2004 earnings. The two mines affected by the strike, which account for three quarters of Volcan’s output, were operating at 50 percent capacity during the strike.
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Mesa Sets Election Date
Bolivia’s President Carlos Mesa called elections for a constituent assembly that will decide on calls for greater regional autonomy and changes to a hydrocarbon law. The elections will take place October 16. Last week thousands of protesters marched through the streets of La Paz and blocked highways with tree trunks, boulders and flaming tires to pressure for a constituent assembly, higher taxes on oil and gas output and nationalization of the hydrocarbon industry.