Trade Tiff weighs on emerging markets as Mexican peso weakens

With the commercial kerfuffle that hit investors, emerging-market assets began the week with more declines.

The Mexican peso reversed the initial gains at weakening 0.5% against the dollar after 64 years of overwhelming victory of Andres Manuel Lopez Obrador, according to preliminary figures announced by the electoral council. Meanwhile, the zloty, the rand, the lira and the yuan all fell as the Bloomberg Dollar Spot Index rose

Click here to see the assets that could move the night of the elections in Mexico

The minutes from the Federal Reserve on Thursday, as well as unemployment data on Friday, as investors assess whether trade frictions have impacted the nation's economic outlook. A cut-off date for US $ 34 billion in tariffs for China is also expected on Friday. The Asian country is committed to retaliate if President Donald Trump takes his course.

What you need to know about emerging markets this week: audio

"Things must get worse before they improve – Claudio Piron, co-author responsible for the currency and rate strategy for Asia at Bank of America Merrill Lynch in Singapore, told Haidi Lun and Rishaad Salamat of Bloomberg TV

. "Mexico and how this will affect Nafta" The deadline for tariffs is "decisive" to determine how far the situation will get worse "before things can get better," he said.

The War of Words Between the world's largest economies the liquidation caused by the rising dollar and hawkish central banks in developed economies.He sent a Bloomberg currency index that measures the carry-trade returns of eight emerging markets, funded by short positions on the do llar, which has fallen the most on a quarterly basis since 2011.

WATCH: What is the next step for emerging markets? Emerging market equities and currencies fell the most since 2015 in the three months to June, and a Bloomberg Barclays local currency bond index recorded its first quarterly decline since 2016. Equity and currency indicators have extended their declines Monday. [19659002"L'impactpratiquedesguerrescommercialesestfaiblejusqu'àprésentetprofiteàdenombreuxcréditsdesmarchésémergentsparexemplelessociétéspétrolièresetmétallurgiquesmaisl'impactbaissiersurlesentimentetlapossibilitéd'unespiraledescendantel'crush"adéclaréRichardSegalunanalysteprincipalchezGestiond'actifsManuvieltéeàLondres

"It is advisable to remain cautious for some time, and better opportunities & Purchase will appear later in the summer, "he said. 015] That's all of China

• Growing trade tensions have already seen the yuan, which has been a point of anchor of stability during the liquidation of emerging markets in recent months, s & # 39; 39, weaken to its lowest since August. Trade frictions and worries about continued economic slowdown have plunged Chinese equities into a bear market
• The composite index of the Shanghai Stock Exchange has lost 2.5% of its lowest since March 2016 [19659014] Private measure for June The manufacturing activity of Caixin Media and Markit Economics slightly exceeded expectations at 51 against a median estimate of 51.1 in a Bloomberg survey of analysts
• READ MORE: Panel PBOC signals shift to growth and stabilization of the market

Traders will also look at the strength of Lopez Obrador's party in Congress

Wells Fargo said the peso could rise to 19 percent if the Morena party fails to gain a majority, or weaken to 21 if it gains control in both houses of Congress. The currency rose up to 1.4% against the dollar after exit polls before dropping 0.2% to 19.9388 at 6:57 am in London

• Traders will also be in the lurch. look for signs that Lopez Obrador will continue during commercialization.

Data Driven

• South Africa will release manufacturing PMIs and the entire economy respectively on Monday and Wednesday, and the South African Reserve Bank will release data on the United States. gold and the foreign exchange reserves on Friday. The rand experienced its worst quarter in about seven years
• Traders who track Brazil's interest rates will turn to the June inflation figures. While inflation is low, analysts want to know if the 11-day truckers strike has had an impact on prices. The central bank of Brazil has reduced its growth estimate of 2018 and predicts that consumer prices will remain below target until 2020. Stock investors will also follow news of Petrobras, Brazil's lower house being expected . vote on amendments to a bill allowing the state-controlled oil producer to sell up to 70% of a major offshore oil project. The government plans to get the Senate to quickly pass the bill to sell the excess oil in an auction that could yield more than $ 25 billion

Poland prepares the June PMI at 9am Monday by preliminary data on inflation for June. The liquidation of the zloty against the euro has led its relative strength index over 14 weeks above 70 for the first time since January 2016

• South Korea and Malaysia will issue trade numbers. Inflation data from South Korea, the Philippines and Taiwan are also due. Thailand reported that inflation slowed in June to 1.38% from 1.49% the previous month
• . June, the slowest pace since December 2016

Central bankers have their say

• The Hungarian forint, at a historic lows against the euro, is in the spotlight. Despite a legislator's proposal that central bank governor Gyorgy Matolcsy is expected to speak in parliament this week, a statement from the regulator suggests that he will probably not do so because the invitation is "politically motivated" ". released conditions
  • A report released Wednesday may also provide investors with some clarity on the intentions of rate fixers
• The Romanian central bank is expected to hold a meeting on Wednesday rates. Investors are assessing whether the next rise will come in July or later, with inflation being the fastest since 2013. Governor Mugur Isarescu's comments on the leu will also be closely monitored. The currency, which is managed by the central bank, has remained relatively stable throughout the sale

– With the help of Alec McCabe, Robert Brand, Marton Eder and Adrian Krajewski [19659002] () of the first paragraph with Mexican currency movements. )