MX Peso Hits Six-Week High as Investors Back Clinton Michelle F. Davis and Netty Ismail - Financial Review
go to original October 20, 2016

Bank of Mexico Governor Agustin Carstens said last month the peso was undervalued (Susana Gonzalez)

Mexico's peso rose to a six-week high in a signal that investors may perceive Hillary Clinton held on to her advantage over Donald Trump in the final US presidential debate.

The currency outperformed all of its 16 major peers as it rose for a fourth straight day. It gained 0.2 per cent, to 18.4790 per dollar as in afternoon trade in Tokyo, after rising to as high as 18.4558, the most since September 8.

Mexico's peso, which as one of the most liquid emerging-market currencies is used by traders to hedge against global risks, has reflected investor anxieties before this year's US election, often falling when Trump's campaign appears on the upswing and gaining when Ms Clinton advances. In the third debate, the Republican candidate repeated his pledge to renegotiate the North American Free Trade Agreement if he's elected.

His recent struggles have been a boon for peso bulls: the currency is up more than 7 per cent since the first presidential debate on September 26, the biggest gain among its major peers.

"With the polls so heavily in Clinton's favour, markets are priced for her victory," said Sean Callow, a senior strategist at Westpac in Sydney. "There probably would only have been a sharp move in markets if Trump had performed extremely well, which wasn't the case."

A Bloomberg Politics national poll on Thursday showed Clinton expanded her lead over Mr Trump as the pair approach the final presidential debate.

Read the rest at Financial Review

Related: Mexico Is Making Banks Conduct Stress Tests to Simulate Trump Victory (Business Insider)

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