RGP Newsletter – Mexico & the Americas Update September - November 2016

RGP

Mexico & The Americas UpdateSeptember – November 2016

Outline

2

Country Risk

Mexican Stock Exchange

Securities Market

1

2

3

4

Exchange Rates

Inflation Rate5

Investment Unit (UDI)6

Economic Confidence Indicator (IMCE)7

International Reserves8

Mexico Economic Overview

United States

Canada

Colombia

1

2

3

4

Mexico

Brazil5

Argentina6

Chile7

Peru8

The Americas Economic Overview

Mexican Exchange Rates

3

$19.60$20.10$20.60$21.10$21.60$22.10$22.60$23.10

30/11/16$21.8418

September October November

30/09/16$21.6370

31/10/16$20.6850

$15.15$16.15$17.15$18.15$19.15$20.15$21.15

30/11/16$20.5155


30/09/16$19.3776

31/10/16$18.8887

$21.60$22.40$23.20$24.00$24.80$25.60$26.40$27.20

30/11/16$25.5459


30/09/16$25.1153

31/10/16$22.9894

$12.50$13.00$13.50$14.00$14.50$15.00$15.50$16.00

30/11/16$15.2416


30/09/16$14.7449

31/10/16$14.0174

Note: Mexican Pesos per CurrencySource: Mexican Central Bank, www.banxico.org.mx, 2016

http://www.banxico.org.mx/

Mexican Country Risk

4

The Country Risk indicates the possibilities of an emerging country failing to fulfill its obligations over external debt payments, whether for capital or interest. The higher the Country Risk, the larger the possibility of default.

It is composed of three main sources:

• Sovereign Risk

• Transfer Risk

• Generic Risk

It is measured through the use of the Emerging Markets Bond Index (EMBI) created by J.P. Morgan Chase.

Source: www.economia.com.mx, 2016

September October November200

210

220

230

240

250

260

270

220 221

258

Country Risk

Note: Basis points

http://www.economia.com.mx/

Mexican Stock Exchange

5Source: Mexican Stock Exchange (BMV), http://www.bmv.com.mx/, 2016

The Mexican Stock Exchange (BMV) is a public institution that operates under a concession granted by the Ministry of Finance (SHCP), observing the Mexican Securities Law. Its shareholders are authorized brokerage firms, which each own one share. Its broad market indicator is known as “Indice de Precios y Cotizaciones” (IPC).

Marketable Securities•Capitals Market (Stocks, Fibras)•Capital Development Market (CKDes)

• Debt Market (Government, Short, Medium and Long Term Debt).

Sep-tember

30th

October 31st

November 30th

43,50044,00044,50045,00045,50046,00046,50047,00047,50048,00048,500

47,245.80

48,009.28

45,315.96

Price and Market Rates Index (IPC)

http://www.bmv.com.mx/

Mexican Securities Market

6Source: Mexican Central Bank, www.banxico.org.mx, 2016

Mexico’s Central Bank (Banxico) carries out operations in the securities market in order to regulate the liquidity of Mexico’s financial system.

It also undertakes primary auctions of securities for the government and other public sector entities, and issues regulations on several financial operations of financial intermediaries.

Cetes 28Zero coupon bonds denominated in Mexican Pesos issued by the Mexican Government. The instrument due in 28 days is a common reference.

Sep-tember

30th

October 31st

November 30th

0.00%

1.00%

2.00%

3.00%

4.00%

5.00%

6.00%

4.41%4.75%

5.62%

Government Securities Auc-tion’s Monthly Results (Cetes

28-days)


Mexican Inflation Rate


Inflation can be defined as a continuous and

widespread increase in goods and services

prices.

The Consumer Price Index (CPI) is the

statistical instrument that calculates inflation

by continuously measuring the price

changes of households’ representative

basket of goods and services. Sep-tember

October November 2.50%

2.60%

2.70%

2.80%

2.90%

3.00%

3.10%

2.73%

2.97%

3.06%

Annualized Inflation Rates measured monthly


Mexican Investment Unit (UDI)

8Source: Mexican Central Bank, www.banxico.org.mx and Ministry of Finance, www.sat.gob.mx, 2016

The Investment Unit (Unidad de Inversion,

UDI) is a value unit linked to the overall

movement of prices. It is commonly used in

financial operations or investment

instruments that are required to guarantee a

return above inflation. The Mexican Central

Bank is the responsible authority to publish

its value in Mexican Pesos for each day of the

month. Sep-tember

30th

October 31st

November 30th

5.400000

5.420000

5.440000

5.460000

5.480000

5.500000

5.520000

5.540000

5.454790

5.493667

5.527929

Investment Unit (UDI)


http://www.sat.gob.mx/

Mexican Economic Confidence Index (IMCE)

9Source: Public Accountants Mexican Association, IMCP, http://imcp.org.mx/, 2016

The Mexican Economic Confidence Index, IMCE, is an indicator which aims to quantify the expectation of the perceived business climate through the perception of more than 20,000 registered public accountants of nearly 60 colleges affiliated to Public Accountants Mexican Institute, IMCP.

The indicator is divided into two main components, which presents the current perception in the business climate as well as the perspective in six months. Its score is measured through a range of 0 to 140 points. Higher values represent higher optimism.

Sep-tember

October November$65

$66

$67

$68

$69

$70

$71

$72

69.9870.84

67.05

Economic Confidence Indi-cator

http://imcp.org.mx/

Mexican International Reserves


Known as financial assets invested abroad by the Mexican Central Bank that can easily be converted into means of payment.

According to the Mexican Central Bank, the following are considered as International Reserves:

• Foreign bank notes and coins;

• Deposits, securities and stocks payable outside of Mexico;

• Loans by Central Banks payable at no longer than six months;

• The Special Drawing Rights at the International Monetary Fund.

Sep-tember

30th

October 31st

November 30th

$173,000

$173,500

$174,000

$174,500

$175,000

$175,500

$176,000

$176,500$175,935

$175,230

$174,078

International Reserves (Mil-lion USD)


20 Largest Economies by GDP

11Source: World Bank, 2016

Saudi ArabiaSwitzerland

TurkeyNetherlands

IndonesiaMexico

SpainRussia

AustraliaKorea

CanadaBrazil

ItalyIndia

FranceU.K.

GermanyJapanChina

U.S.

$0 $2,000 $4,000 $6,000 $8,000 $10,000 $12,000 $14,000 $16,000 $18,000 $20,000

$646.0$664.7$718.2$752.5$861.9

$1,144.3$1,199.1$1,326.0$1,339.5$1,377.8$1,550.5

$1,774.7$1,814.7

$2,073.5$2,421.6

$2,848.7$3,355.7

$4,123.2$10,866.4

$17,946.9

20 Largest Economies by GDP

Billion, Current US$

12

The Americas Economic Overview

Mexico

13

MexicoInflation Rate(Consumer Prices, Annual) 2.7%

Gross Domestic Product (GDP)(Current USD, 2015) (Trillion USD) $1.144

GDP Growth Rate(2015) 2.5%

GDP per Capita(Current USD, 2015) $9,710

International Reserves(Million USD, March 2016) $179,708.03

Exchange Rate(Mexican pesos per USD, July 29th, 2016) $18.7837

Corruption Perception(Corruption Perception Index, Score 2015) 35 / 100

Global Competitiveness Index(Min 2.84; Max 5.76) (2015 – 2016 Edition) 4.3

Source: World Bank, International Monetary Fund, Transparency International, World Economic Forum and Bloomberg, 2016.

United States

14

United StatesInflation Rate(Consumer Prices, Annual) 0.1%




International Reserves(Million USD, April 2016) U$121,269.45

Exchange Rate(Euro per USD, July 29th, 2016) $0.8949




Canada

15

CanadaInflation Rate(Consumer Prices, Annual) 1.1%




International Reserves(Million USD, April 2016) $83,922

Exchange Rate(CAN per USD, July 29th, 2016) $0.7677




Colombia

16

ColombiaInflation Rate(Consumer Prices, Annual) 5.0%

Gross Domestic Product (GDP)(Current USD, 2015) (Billion USD) $292.1




Exchange Rate(Colombian pesos per USD, July 29th, 2016) $3,071.30




Brazil

17

BrazilInflation Rate(Consumer Prices, Annual) 9%


GDP Growth Rate(2015) -3.8%


International Reserves(Million USD, April 2016) $362,200.63

Exchange Rate(Brazilian real per USD, July 29th, 2016) $3.2489




Argentina

18

ArgentinaInflation Rate(Consumer Prices, Annual) 10.6%





Exchange Rate(Argentinian pesos per USD, July 29th, 2016) $15.0050




Chile

19

ChileInflation Rate(Consumer Prices, Annual) 4.3%





Exchange Rate(Chilean pesos per USD, July 29th, 2016) $655.70




Peru

20

PeruInflation Rate(Consumer Prices, Annual) 3.6%




International Reserves(Million USD, May 2016) $60,445

Exchange Rate(Peruvian pesos per USD, July 29th, 2016) $3.3520




Our Global Footprint

21

OFFICES SUPPORTING THE AMERICAS

47 OFFICES SUPPORTING EUROPE

13OFFICES SUPPORTING ASIA PACIFIC

12

Global capability with an emphasis on local execution.

Potential areas of collaboration

We would love to explore opportunities for collaboration with your company, becoming your trusted business partners for your Latin American operations in any of the following scenarios:

- Traditional Headhunting

- Interim Operational Support (Director and Manager levels)

- Project Support (System Implementations, Compliance, Project Management, Audits, Special or confidential initiatives)

- Traditional Consulting (Assessments, Assurance, Process Improvement, Reengineering, Business transformations, M&A, Integrations, Turn-arounds)

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Why RGP?

• We offer maximum flexibility for your projects and initiatives.

• You select the consultants you want to work with. We do not impose a decision.

• We can strengthen your talent pool in a quick and reliable way.

• You are not hiring a single consultant, but a solid international consulting firm.

• Would you want to hire one of our consultants? We offer a model that can give you the best value in terms of talent recruitment.

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Your Latin America Team – Let’s talk!

NESTOR GONZALEZ

Senior Managing Director – Latin America

[email protected]

+1.713.403.1967

ARMANDO NURICUMBO, CPA

Managing Director - Mexico

[email protected]

+52.55.2000.6505

RAMON MONROY

Director – Strategic Accounts

[email protected]

+52.55.2000.6522

MEXICO CITY OFFICE

Mariano Escobedo 476 P14, Nueva Anzures, Mexico DF, 11590

www.ResourcesGlobal.mx

+52.55.2000.6500

mailto:[email protected]




RGP Newsletter – Mexico & the Americas Update September - November 2016

Economy & Finance

Transcript of RGP Newsletter – Mexico & the Americas Update September - November 2016