Latin America Advisor 2024-06-14 – Inter-American Dialogue

LATIN AMERICA ADVISOR

A daily publication Of the dialogue

June 14, 2024

What Does Morena’s Dominance Mean for Mexico’s Economy?

Mexico’s peso has tumbled against the U.S. dollar since Claudia Sheinbaum was elected president and the ruling Morena party dominated congressional elections on June 2. // File Photo: Mexican Government.

Q

A day after the landslide victory of Claudia Sheinbaum, the candidate of Mexico’s ruling Morena party, and the party’s dominant showing in congressional and state races, the country’s peso and stock market plummeted. The following day, Finance Minister Rogelio Ramírez de la O–who Sheinbaum said will remain in his position in her administration–sought to reassure investors that the incoming government will remain committed to fiscal discipline. He said the government will cut the budget deficit and maintain central bank autonomy. To what extent is Sheinbaum’s team calming the markets, and how are investors likely to react in the coming months? What will Sheinbaum’s policies mean for Mexico’s economy and investment? What are the biggest economic changes that Mexico could see under her administration?

A

Andrés Rozental, member of the Advisor board, president of Rozental & Asociados and former deputy foreign minister of Mexico: “The most important lesson for Mexico’s president-elect to learn since her landslide victory is that financial markets and investors act as a check on questionable economic and political proposals. Although current President López Obrador (AMLO) insists that ‘justice’ trumps the markets, or even the law, Claudia Sheinbaum had a good baptism of fire as to why that isn’t the case. Even after Mexico’s finance minister tried to calm markets, the peso fell more than 8 percent in the week after…”

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ABOUT THE LATIN AMERICA ADVISOR

The Inter-American Dialogue publishes the Latin America Advisor every business day for a distinguished membership of informed corporate leaders, scholars, and government officials invested in Latin America’s development and future. The Advisor‘s highly regarded Q&A section covers questions submitted by subscribers themselves. Commentators regularly include heads of state, business leaders, diplomats, economists, analysts, and thought leaders from around the world. Many of the world’s largest and fastest-growing companies subscribe to the Advisor. To subscribe, click here. For terms and conditions, click here. For more information, contact Gene Kuleta, editor of the Advisor, at gkuleta@thedialogue.org.

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Staff

Gene Kuleta
Editor
202.463.2920
gkuleta@thedialogue.org

Jack Quinn
Reporter

jquinn@thedialogue.org

Lori Rampani
Reporter

lrampani@thedialogue.org

board of advisors

Diego Arria
Director,
Columbus Group

Merike Blofield
Professor of Political Science,
University of Hamburg

Devry Boughner Vorwerk
CEO,
DevryBV Sustainable Strategies

Joyce Chang
Global Head of Research,
J.P. Morgan

Marlene Fernández
Corporate Vice President for Gov’t Relations,
Arcos Dorados (McDonald’s)

Peter Hakim
President Emeritus,
Inter-American Dialogue

Donna Hrinak
Director,
Adtalem Global Education

Jon E. Huenemann
Council Member,
GLG Inc.

James R. Jones
Chairman,
Monarch Global Strategies

Craig Kelly
Senior Director,
Int’l Gov’t Relations,
Exxon Mobil

Barbara Kotschwar
Professor of Political Economy,
Georgetown University

John Maisto
Director,
US Education Finance Group

Nicolas Mariscal
Chairman,
Grupo Marhnos

Thomas F. McLarty III
Chairman,
McLarty Associates

Beatrice Rangel
Director,
AMLA Consulting

Ernesto Revilla
Head of Latin American Economics, Citi

Gustavo Roosen
President,
IESA

Andrés Rozental
President, Rozental &
Asociados

Shelly Shetty
Managing Director,
Sovereigns, Fitch

ONLINE EVENT: After the Vote—What’s Next for Mexico’s Judiciary?

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