Word: pesos
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Dates: during 1990-1999
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...making for jumpy nerves was evident: Mexico, and the hurdles the Clinton Administration was facing in trying to pull together a $40 billion loan-guarantee package for the battered neighbor. The scare that had afflicted financial markets in the wake of Mexico's debilitating Dec. 20 devaluation of the peso was developing into something more serious: a general skittishness about markets in countries embracing tariff cutting, deregulation and the sale of state-owned assets on the road to modernization. The new, skeptical mood was in fact spreading beyond the Third World to affect countries like Spain, Italy and Sweden, which...
...peso devaluation ``raised the premium for emerging markets,'' said Peter Churchouse, managing director of Morgan Stanley Asia Ltd. in Hong Kong. ``American investors in particular got into them in a wave of euphoria. A lot of the new investors were naive to the risks. What Mexico has done is to hit everyone over the head and say, `Look, there are risks...
...destabilization--as may Latin America as a whole. Already the uncertainty about Washington's course of action is accelerating the Mexican economy's downturn. Some 4,000 businesses closed in the first four weeks of 1995 because of high interest rates, lack of sales and tight credit since the peso crash. Predictions of the annual inflation rate for 1995 run to 20% or more, and many economists expect the economy to shrink at least 2%, even if the U.S. guarantee is approved. Government and private analysts contend that while direct foreign investment will fall only slightly below last year...
...midweek, Mexico got a measure of relief when the International Monetary Fund approved a $7.8 billion loan, the largest it has ever made, to help stabilize the peso. Argentina, Brazil, Chile and Colombia also jointly opened a $1 billion credit line for Mexico. But the infusions were not large enough to solve Mexico's most serious challenge: finding sufficient funds to pay off or refinance $26 billion in mostly foreign-owned short-term bonds maturing during 1995. The government got a hint of the difficulties ahead last week when it put at auction $400 million in U.S. dollar-denominated bonds...
Germany complained today that President Clinton had not consulted adequately with European lending partners in his haste to fashion aworkable peso rescue package. "We would have wished the coordination to have been a little tighter," Finance Minister Theo Waigel told reporters. The International Monetary Fund approved the $17.8 billion plan Wednesday, despite surly abstentions from Britain, Germany, Denmark, the Netherlands, Belgium and Switzerland. "They literally got the proposal an hour before it was announced," says TIME Washington correspondent Suneel Ratan. "It does appear that Clinton has broken a few eggs on the way to making this omelette." U.S. officials told...