EMERGING MARKETS-Brazil real dips, Mexico peso helped by US data

Fri Mar 1, 2013 6:00pm EST

* Weak China, Europe factory surveys hit real
    * Surge in U.S. manufacturing activity helps Mexican peso
    * Brazil real dips 0.17 pct, Mexico peso up 0.16 pct

    MEXICO CITY, March 1 (Reuters) - Brazil's real slipped on
Friday, hurt by weak economic data in its main trading partners
China and Europe while Mexico's peso firmed on a report of
strong U.S. manufacturing activity.
    Investors started the month on a cautious footing as surveys
showed Chinese factories slowed while European manufacturing
output fell. China is Brazil's top trading partner.
    In Brazil, data showing the economy grew only 0.9 percent
last year added to the lackluster market
    Luciano Rostagno, chief strategist at WestLB bank, said the
data pointing to weaker global growth weighed the most. "The
(local) GDP data functioned only as a secondary factor," he
    The Brazilian real  weakened 0.17 to 1.9809 per
dollar. The real trimmed losses after U.S. manufacturing
activity expanded last month at its fastest clip in 20
    Mexico's peso  shook off a steep drop to firm
0.16 percent to 12.7650 per dollar. 
    The peso fall, off a high in January after Mexico's central
bank said it could cut interest rates if inflation keeps cooling
and growth slows. Lower benchmark interest rates curb the
attraction to yield-hungry investors.
    About one in four analysts think Mexico's central bank could
lower its benchmark rate from 4.5 percent next Friday, a Reuters
poll showed on Friday. 
    The majority see the Banco de Mexico waiting until April or
June, but then acting decisively with a 50 basis point
reduction, according to the median of 19 forecasts. 
    Latin American FX prices at 2215 GMT
 Currencies                         daily %    YTD %
                                     change   change
 Brazil real                1.9809    -0.17     3.00
 Mexico peso               12.7650     0.16     0.78
 Chile peso               474.0000    -0.27     0.99
 Colombia peso           1813.2000    -0.02    -2.60
 Peru sol                   2.5940    -0.19    -1.66
 Argentina peso             5.0475     0.00    -2.67

 Argentina peso             7.8200     0.26   -13.30
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Comments (1)
Shugdj wrote:
In the interum, yesterday, after a conflict-fraught deliberation process, the Obama Administration awarded the Light Air Support (LAS) contract to Brazilian-based Embraer over Beechcraft; a Wichita Kansas based company with a long history of supplying the U.S. military with aircraft. Had Beechcraft been granted the contract, the company expected to add or sustain 1,400 jobs in the U.S. The Embraer plane, on the other hand, will be primarily built in Brazil, with only about 50 assembly jobs in the U.S.
After a long-drawn-out contracting process that has been marred in controversy and questionable conduct by government officials, the Pentagon and the Obama Administration have again decided to put taxpayers at risk and ship jobs overseas by allowing a foreign company to produce important components of our national security.

“On Thursday February 27th, Department of Defense (DOD) officials awarded the Light Air Support (LAS) contract to the Brazilian aircraft maker, Embraer. Interestingly and without explanation, the cost of the contract to taxpayers somehow ballooned from $355 million to $427.5 million, a 20 percent increase. With sequestration and billions of dollars in defense cuts set to take place, taxpayers should be outraged at this cost increase.

Mar 02, 2013 4:25pm EST  --  Report as abuse
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