{"id":69224,"date":"2024-06-09T20:14:04","date_gmt":"2024-06-09T20:14:04","guid":{"rendered":"https:\/\/news.talkwithrattan.com\/index.php\/2024\/06\/09\/mexicos-leftists-won-big-investors-are-worried\/"},"modified":"2024-06-09T20:14:05","modified_gmt":"2024-06-09T20:14:05","slug":"mexicos-leftists-won-big-investors-are-worried","status":"publish","type":"post","link":"https:\/\/news.talkwithrattan.com\/index.php\/2024\/06\/09\/mexicos-leftists-won-big-investors-are-worried\/","title":{"rendered":"Mexico\u2019s Leftists Won Big. Investors Are Worried."},"content":{"rendered":"<div style=\"text-align:center\"><img loading=\"lazy\" decoding=\"async\" width=\"1050\" height=\"550\" src=\"https:\/\/i1.wp.com\/static01.nyt.com\/images\/2024\/06\/09\/multimedia\/09mexico-senate-01-jgvp\/09mexico-senate-01-jgvp-facebookJumbo.jpg?resize=1050,550&amp;ssl=1\" class=\"attachment-post-thumbnail size-post-thumbnail wp-post-image\" alt=\"Mexico\u2019s Leftists Won Big. Investors Are Worried.\" title=\"Mexico\u2019s Leftists Won Big. Investors Are Worried.\" \/><\/div><p> <br \/>\n<\/p>\n<div>\n<div class=\"css-53u6y8\">\n<p class=\"css-at9mc1 evys1bk0\">A final count of votes released over the weekend suggests Mexico\u2019s leftist governing party and its allies would capture large majorities in Congress, potentially enabling the coalition to pass sweeping changes to the Constitution.<\/p>\n<p class=\"css-at9mc1 evys1bk0\">The official tally from elections last week showed that the party, Morena, and its partners appeared on their way to clinching a two-thirds supermajority in the lower house of Congress.<\/p>\n<p class=\"css-at9mc1 evys1bk0\">In the Senate, it seemed that the coalition would fall short of a supermajority \u2014 but by a small number of seats, analysts said, meaning it would likely need to attract the support of only a few opposition legislators to alter the Constitution. Building those alliances \u201cis relatively easy to achieve,\u201d said the party\u2019s president, Mario Delgado, in an interview.<\/p>\n<p class=\"css-at9mc1 evys1bk0\">\u201cWe are now a dominant force,\u201d Mr. Delgado added, \u201cby the decision of the people.\u201d<\/p>\n<p class=\"css-at9mc1 evys1bk0\">The final makeup of the legislature is still unclear because a share of seats in the Mexican Congress are appointed via a system of proportional representation in August. Legal challenges could also affect how seats are allocated. <\/p>\n<\/div>\n<aside class=\"css-ew4tgv\" aria-label=\"companion column\"\/><\/div>\n<div>\n<div class=\"css-53u6y8\">\n<p class=\"css-at9mc1 evys1bk0\">But Morena has come close enough to total dominance to prompt a strong reaction from a sector that the party can\u2019t ignore: the financial markets.<\/p>\n<p class=\"css-at9mc1 evys1bk0\">In the volatile days following the election, investors\u2019 alarm has been on full display, with Mexican stocks battered and the peso suffering its worst week since the pandemic.<\/p>\n<p class=\"css-at9mc1 evys1bk0\">The concern centered on the possibility that Morena would use its broad mandate to enact constitutional changes that detractors warn could gut existing checks on presidential authority, financial analysts said.<\/p>\n<p class=\"css-at9mc1 evys1bk0\">The proposals were first introduced by Andr\u00e9s Manuel L\u00f3pez Obrador and include plans to eliminate independent regulators and to appoint judges and election officials via popular vote, which critics warn could make them more susceptible to political pressure. Among other concerns, investors fear that upending the judiciary <a class=\"css-yywogo\" href=\"https:\/\/www.nytimes.com\/2024\/06\/03\/world\/americas\/mexico-election-morena-results.html\" title=\"\">could make it less certain<\/a> that they\u2019ll get a fair hearing in disputes.<\/p>\n<p class=\"css-at9mc1 evys1bk0\">\u201cThe feeling of the market is that under the Morena party and with this plan on the table, a radical change could be coming,\u201d said Janneth Quiroz Zamora, director of economic research at the brokerage Monex. \u201cThe biggest fear is about the possible elimination of checks on executive power.\u201d<\/p>\n<\/div>\n<aside class=\"css-ew4tgv\" aria-label=\"companion column\"\/><\/div>\n<div>\n<div class=\"css-53u6y8\">\n<p class=\"css-at9mc1 evys1bk0\">In what seemed to be an attempt to calm the market, the incoming president, Claudia Sheinbaum, a prot\u00e9g\u00e9e of Mr. L\u00f3pez Obrador, announced last Monday that the current finance minister, Rogelio Ram\u00edrez de la O, who is seen as a stabilizing force, would stay in the job.<\/p>\n<p class=\"css-at9mc1 evys1bk0\">\u201cHe is a great public servant who provides certainty of good financial and economic management,\u201d she said.<\/p>\n<p class=\"css-at9mc1 evys1bk0\">Ms. Sheinbaum won the presidency with the largest share of votes in decades and Morena also claimed most of the governorships on offer. <\/p>\n<p class=\"css-at9mc1 evys1bk0\">Her initial comments encouraged investors that \u201cthe government was sensitive to their concerns,\u201d said Blanca Heredia, a political analyst based in Mexico City. That was \u201cmostly because of the speed of the reaction,\u201d Ms. Heredia said, noting that the new president \u201cneeds and wants economic growth.\u201d<\/p>\n<\/div>\n<aside class=\"css-ew4tgv\" aria-label=\"companion column\"\/><\/div>\n<div>\n<div class=\"css-53u6y8\">\n<p class=\"css-at9mc1 evys1bk0\">But then on Thursday, the leader of Morena in the lower house of Congress, Ignacio Mier, appeared to announce that the party would seek to approve the constitutional changes in September, before Mr. L\u00f3pez Obrador steps down and Ms. Sheinbaum takes over.<\/p>\n<\/div>\n<aside class=\"css-ew4tgv\" aria-label=\"companion column\"\/><\/div>\n<div>\n<div class=\"css-53u6y8\">\n<p class=\"css-at9mc1 evys1bk0\">The peso fell again. Hours later, Mr. Mier walked back his statement in a radio appearance in which he suggested that any changes wouldn\u2019t be rushed through.<\/p>\n<p class=\"css-at9mc1 evys1bk0\">Ms. Sheinbaum later told reporters the measures would be subject to broad dialogue. She also posted a photo of herself meeting with an executive from the investment firm BlackRock. \u201cThey are committed and enthusiastic about increasing investment projects in Mexico,\u201d she said on social media.<\/p>\n<p class=\"css-at9mc1 evys1bk0\">Mr. Delgado, the party president, said that Mr. L\u00f3pez Obrador and Ms. Sheinbaum would need to agree on how to move forward with the plans.<\/p>\n<p class=\"css-at9mc1 evys1bk0\">\u201cThese are reforms that will need to be discussed and their reach, their final version, will come about in the Congress, and the pace of their approval will be decided by the president,\u201d he said, referring to Ms. Sheinbaum.<\/p>\n<\/div>\n<aside class=\"css-ew4tgv\" aria-label=\"companion column\"\/><\/div>\n<div>\n<div class=\"css-53u6y8\">\n<p class=\"css-at9mc1 evys1bk0\">The upshot, analysts said, is that in a political system where one party has so much control, the market could emerge as a moderating force.<\/p>\n<p class=\"css-at9mc1 evys1bk0\">\u201cI do think this adverse reaction from the market is going to cause a very thorough rethinking of what they are going to approve and how they are going to approve it in September,\u201d said Joan Domene, a Mexico City-based senior economist for Latin America at Oxford Economics, an economic consultancy.<\/p>\n<\/div>\n<aside class=\"css-ew4tgv\" aria-label=\"companion column\"\/><\/div>\n<div>\n<div class=\"css-53u6y8\">\n<p class=\"css-at9mc1 evys1bk0\">Mr. L\u00f3pez Obrador, though, seemed undeterred. At his regular news conference on Friday morning, the president reiterated his commitment to the changes and seemed to minimize the peso\u2019s declines, saying, \u201cjustice is above the markets.\u201d<\/p>\n<p class=\"css-at9mc1 evys1bk0\">The mixed messages showed, analysts said, that investors\u2019 influence will depend on whether the people leading Morena \u2014 including Mr. L\u00f3pez Obrador \u2014 actually listen to them.<\/p>\n<p class=\"css-at9mc1 evys1bk0\">\u201cMarkets are a straitjacket for politics,\u201d he said. \u201cBut not for everyone equally.\u201d<\/p>\n<p class=\"css-798hid etfikam0\">Emiliano Rodr\u00edguez Mega<!-- --> and Miriam Castillo contributed reporting.<\/p>\n<\/div>\n<aside class=\"css-ew4tgv\" aria-label=\"companion column\"\/><\/div>\n<p><br \/>\n<br \/><a href=\"https:\/\/www.nytimes.com\/2024\/06\/09\/world\/americas\/mexico-sheinbaum-amlo-peso.html\">Source link <\/a><\/p>\n","protected":false},"excerpt":{"rendered":"<p>A final count of votes released over the weekend suggests Mexico\u2019s leftist governing party and its allies would capture large majorities in Congress, potentially enabling the coalition to pass sweeping changes to the Constitution. The official tally from elections last week showed that the party, Morena, and its partners appeared on their way to clinching [&hellip;]<\/p>\n","protected":false},"author":2,"featured_media":69225,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"tdm_status":"","tdm_grid_status":"","fifu_image_url":"https:\/\/static01.nyt.com\/images\/2024\/06\/09\/multimedia\/09mexico-senate-01-jgvp\/09mexico-senate-01-jgvp-facebookJumbo.jpg","fifu_image_alt":"","footnotes":""},"categories":[1],"tags":[995,6089,36435,5733,14057,3165],"amp_enabled":true,"_links":{"self":[{"href":"https:\/\/news.talkwithrattan.com\/index.php\/wp-json\/wp\/v2\/posts\/69224"}],"collection":[{"href":"https:\/\/news.talkwithrattan.com\/index.php\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/news.talkwithrattan.com\/index.php\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/news.talkwithrattan.com\/index.php\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/news.talkwithrattan.com\/index.php\/wp-json\/wp\/v2\/comments?post=69224"}],"version-history":[{"count":1,"href":"https:\/\/news.talkwithrattan.com\/index.php\/wp-json\/wp\/v2\/posts\/69224\/revisions"}],"predecessor-version":[{"id":69226,"href":"https:\/\/news.talkwithrattan.com\/index.php\/wp-json\/wp\/v2\/posts\/69224\/revisions\/69226"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/news.talkwithrattan.com\/index.php\/wp-json\/wp\/v2\/media\/69225"}],"wp:attachment":[{"href":"https:\/\/news.talkwithrattan.com\/index.php\/wp-json\/wp\/v2\/media?parent=69224"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/news.talkwithrattan.com\/index.php\/wp-json\/wp\/v2\/categories?post=69224"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/news.talkwithrattan.com\/index.php\/wp-json\/wp\/v2\/tags?post=69224"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}