Mexico’s peso rose for the first time in four days as a report showed confidence among U.S. small businesses climbed last month, boosting the outlook for the Latin American country’s biggest trading partner.
The shekel weakened the most in more than four months after the Bank of Israel’s surprise interest rate cut and vow to buy as much as $2.1 billion in 2013 to curb the currency’s appreciation. Stocks rose the most in two months.
Mexico’s peso plunged as industrial production fell three times more than analysts forecast in March, stoking speculation that policy makers will cut borrowing costs in Latin America’s second-biggest economy.
Mexico’s peso bonds gained, sending yields to a record low, after Fitch Ratings upgraded the nation one notch and as Grupo Financiero Banorte SAB projected the central bank will reduce the key rate in July.
Mexican peso bonds rose, pushing yields down from a two-week high, on speculation the government is making progress in its drive for legal changes to spur growth in Latin America’s second-biggest economy.
Traders’ expectations for swings in the Mexican peso fell to an eight-week low as foreign investors seeking to profit from the country’s higher interest rates pour into the Latin American nation, options show.