Mexican peso and stock market operate in volatile session by omicron and Fed, record weekly rise

MEXICO CITY, Dec 3 (Reuters) – The Mexican peso and the stock market traded in the last session of the week with ups and downs, due to persistent fears of the threat that the variant of the omicron coronavirus could represent for the economy, in addition to the uncertainty due to the next steps of the US Federal Reserve.

Mexico became the second country in Latin America after Brazil to register a case of omicron, when it reported on Friday the presence of the strain in a person from South Africa.

* The local currency was trading at 21.2730 per dollar near the end of the session, down 0.12% compared to 21.2480 in the Reuters reference price on Thursday. The peso gained until 21.1675 units and depreciated to almost 21.5 per dollar.

* Meanwhile, the local benchmark S & P / BMV IPC index lost 0.65% to 50,597.29 points with a volume of 181.6 million securities traded.

* “A factor of decline in the peso can be attributed to the issue of concern generated by this uncertainty about omicron and the fact that it is already present in our country,” said James Salazar, economist at CI Banco. He added that a profit taking was observed after gains recorded in several days this week.

* Both the domestic currency and the leading index of local stocks posted weekly gains of 2.9% and 2.23% respectively, interrupting a streak of three declines.

* Despite the fact that job creation in the United States fell short of expectations, the Fed’s monetary policy makers seem willing to accelerate the reduction of its bond buying program when they meet this month, because they want to take precautions in case inflation does not recede next year, as expected.

* In November, 210,000 jobs were created in the world’s largest economy, below expectations, compared to a figure of 546,000 in the previous month. A Reuters poll of 87 economists had forecast job creation to rise to 550,000.

* In the debt market, the 10-year bond yield fell seven basis points to 7.38%, while the 20-year rate fell two to 7.79%.

(Report by Miguel Angel Gutiérrez)

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