MEXICO CITY (AP) — Mexico’s peso continued to recover Tuesday from its steep drop last week, as experts denied the resurgence of a leftist candidate in polls on the July 1 presidential race had anything to do with the decline.
They said continuing concerns about Europe’s sovereign debt crisis and the U.S. economy are the driving forces behind the currency’s volatility.
“The elections aren’t affecting the exchange rate in Mexico,” said Ana Gonzalez, a currency exchange analyst for Grupo Financiero Monex. “It’s going to move much more because of events in Europe and the United States.”
The peso closed Tuesday at an interbank rate of around 14.23 per $1, after falling as low as 14.60 in trading last week. The peso closed at 14.39 on Friday and 14.24 on Monday. At the beginning on May, it was trading around 13.00 to $1.
The governor Mexico’s central bank, Agustin Carstens, said last week that investors’ fears about a possible Greek debt default of exit from the Euro, and concerns about debt in Spain and Italy, were driving investors to seek safe havens, hitting emerging markets like Mexico.
However, some media analysts reported that investors’ concerns may have been fed by a poll released Thursday by the newspaper Reforma which said that centrist candidate Enrique Pena Nieto had 29 percent support, with Lopez Obrador close at 26 percent.
The poll was conducted in late May and had a margin of error of 3 percentage points. A month earlier, Pena Nieto had led the leftist 32 percent to 21 percent in the same poll.
Some business groups opposed Lopez Obrador during his failed 2006 presidential bid, claiming he would endanger private property and economic stability, accusations Lopez Obrador denied.
This week, other polls have since been released showing that, while Lopez Obrador does appear to be gaining on Pena Nieto, he is anywhere from nine to 14 points behind the front-runner.
