MEXICO CITY, July 16 (Reuters) - The Mexican peso fell on
Thursday as a pullback in regional U.S. factory activity dimmed
the prospect of an industrial rebound in Mexico.
The decline came a day after the biggest rally in more than
a month. Dealers pushed the currency <MXN=><MEX01> 0.24 percent
lower to 13.58 pesos per dollar.
"The peso's move is largely speculative," said one trader.
Mexican stocks, which had surged more than 4 percent on
Wednesday, extended gains. The IPC index <.MXX> was up 0.15
percent, supported by big advancers like Banorte <GFNORTEO.MX>,
which was up 1.77 percent.
Nudging the currency lower, the Philadelphia Fed's index of
Mid-Atlantic manufacturing activity fell more than expected to
minus 7.5 in June. That countered some of the optimism that
followed an improved reading in a measure of business activity
in New York State.
Such softness raised concerns about Mexico's own
manufacturing activity, which has plummeted since the start of
the year. Data on Friday is projected to show a 12.5 percent
drop in output for May compared to a year earlier.
Some 80 percent of Mexico's exports are sent to the United
States. The U.S. recession has had a ravaging effect on
Mexico's economy, with gross domestic product set to contract
more than 6 percent this year -- possibly its worst decline
since the Great Depression.
(Reporting by Pedro Nicolaci da Costa and Jean Luis Arce;
Editing by Kenneth Barry)
Keywords: MARKETS MEXICO
