La Jornada – Markets fear a rise in US inflation

Financial markets ended a week of strong moves, triggered by economic and political events, including bets that the US Federal Reserve (Fed) will tighten monetary policy, rebounding inflation and robust debates in the US Congress, as lawmakers left until the last minute to extend funding that Avoid government paralysis.

In this context, the Mexican peso, like most Latin American currencies, closed with gains on Friday, benefiting from a moderate drop in the dollar during the session.

In wholesale operations, the Mexican currency gained 21 cents (1.05 percent) and closed at 20.42 units per dollar. However, it ended the week with a loss of 36 cents (1.79 percent), amid a stronger dollar.

The dollar posted its biggest percentage gain since late August as investors expect the Federal Reserve to start reducing its asset purchases in November and possibly raise interest rates next year. The dollar is up 4.7 percent year-to-date, approaching its highest level in a year against a basket of currencies.

For its part, the Mexican Stock Exchange (BMV) fell by 0.63 percent and remained at 51,60.05 points. During the week, it recorded a marginal decline of 0.09 percent, marking its fifth consecutive week of losses, amid indications of monetary policy tightening from the Federal Reserve and after the Bank of Mexico raised inflation expectations.

On Wall Street, stocks rose: the Dow Jones rose 1.44 percent to 34,332.65 units. The Standard & Poor’s 500 Index rose 1.16 percent to 4,357.42 units and the Nasdaq rose 0.75 percent to 1,4557.34 units. With that said, all three indexes closed below close last Friday, and the S&P 500 and Nasdaq both posted their biggest weekly percentage declines since February.

Oil prices close with profit

A barrel of Mexican export mix rose 39 cents to $71.64 a barrel, Pemex reported. In the week, it rose $1.05 (1.48 percent).

West Texas Intermediate (WTI) advanced 85 cents to $75.88, and European Brent crude rose 97 cents to $79.28.

Brent crude rose above $79 a barrel on Friday, on the verge of reaching a three-year high hit this week, buoyed by expectations that ministers in the Organization of the Petroleum Exporting Countries (OPEC) and its allies, the group known as OPEC+, will meet on Friday. On Monday, they will maintain a steady pace in increasing supplies.