FEBRUARY 2006 EDITION ARCHIVE

• • Business & Politics Outlook

    Mexico Amends Intellectual Property Law

    The recent amendment of the Mexican Intellectual Property Law provides more detailed and reliable regulation of franchise agreements requiring parties to a franchise agreement to include, by law, specific provisions on treatment of royalties; investments and training; geographical zones of exclusivity; inventory and supplier policies, among others. In addition, the amended law contemplates the possibility of a franchisor intervening in the administration of the franchisee in case the party decides... [Read More]

  • Bank of Mexico Reports 3B to Maintain Foriegn Currency Reserves

    The 69.609 billion dollars that Mexico maintains as currency reserves in foreign countries costs 3 billion dollars per year to maintain by virtue of the difference between interest rates paid on United States Treasury bonds and debt instruments issued by the Mexican federal government. In this regard, the governor of the Bank of Mexico will propose to Congress the possibility of utilizing these reserves for paying part of the Mexican external debt, which will avoid financing cost of the currency... [Read More]

  • S&P Increases Mexico Country Risk

    The ratings agency set Mexico’s country risk, known as EMBI+, at 115 points; this is due partially to cost of maintaining reserves outside of Mexico given the relative lower value of United States Treasury bonds. However, Mexico’s country risk continues to be one of the lowest of any Latin American country, compared with Brazil (260 points) and Argentina (408 points).

  • Peso Stability Expected in 2nd Quarter

    The Mexican financial sector expects the peso to remain stable, at an average of around 10.50 pesos per dollar. This stability is reinforced by the addition of millions of dollars in speculative positions favoring the Mexican peso in the Chicago currency futures market.

  • Mexico Vehicle Imports Increase by 79%

    It is true that the Mexican market is an important manufacturer and exporter of vehicles and auto parts, as shown by the market and consumer demand, which have created a market with 38 brands of vehicles, and increases in the importation of vehicles to the Mexican national market, principally from Argentina and Brazil, stated AMIA. The majority of vehicles that are assembled entirely in Mexico are designated for exportation to the world market. Source: Mexican Automotive Industry Association (AMIA).

  • Natural Gas Prices Fall 8% in January

    The warm winter climate, recovery of the production of natural gas in the Gulf of Mexico, and an increase in fuel inventories in the United States have caused a lowering of prices in South Texas. These factors allowed Mexicans to pay for fuel in the month of February at a price of 6.90 dollars per million BTUs, an 8% decrease from the January quote, the Energy Regulatory Commission stated (CRE). This price was lower than prices paid by consumers during the past five months from September 2005 to... [Read More]

  • 2006 Presidential Race

    In the most recent poll published by the newspaper El Universal, Andres Manuel Lopez Obrador, candidate of the Converging Parties for Democracy, comprised of the Labor Party (PT) and the Democratic Revolution Party (PRD) led the electoral survey with 33% of those intending to vote; Felipe Calderon Hinojosa, of the National Action Party (PAN), followed in second place drawing 27% of those polled, and in third place Roberto Madrazo Pintado, presidential candidate of the Institutional Revolutionary... [Read More]

  • Economic Indicators

    Exchange Rate

    The Mexican Peso has maintained a stable position against the U.S. Dollar. The current quoted exchange rate is 10.53 Pesos per Dollar.

  • Mexican Stock Exchange

    MX Stock Exchange (BMV) closed on February 9 at 18,410.24 points

  • Interest Rates

    Interest rates continue to decline. The average Interbank Interest Rate (TIEE) for a 28 day period was at 8.0750%.