Mexico finance minister quits over Lopez Obrador 'disagreements'

Clay Curtis
July 11, 2019

Mexico's moderate Finance Minister Carlos Urzua resigned on Tuesday, citing deep differences over economic issues, in a blow for the government of President Andres Manuel Lopez Obrador, who named a well-regarded deputy minister to replace him.

Urzua said he felt forced to quit by such policy disagreements.

The Mexican peso fell more than two percent on the news, and the benchmark index slid nearly 1.5 percent. "It's been the fault of influential people from the government, in the case of which an obvious conflict of interest", said Ursua.

Investors have anxious about Lopez Obrador's policy direction since he canceled a major airport project before taking office, and the government has clashed with businesses on a number of occasions. Carlos Urzua, who took the post in December of previous year, tweeted out his resignation letter today.

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By contrast, the Federal Reserve is expected to cut benchmark USA interest rates as soon as the end of July. Growth: The Bank of Canada kept interest rates unchanged at 1.75% as expected.

On his watch, however, Urzua was hit by a sovereign debt downgrade and contracting economic growth as he stuck to fiscal targets while setting aside money to support Pemex and Lopez Obrador's plans to splurge on a new oil refinery.

"He (Urzua) doesn't agree with the decisions we're taking and we're committed to changing the economic policy that was imposed over the last 36 years", Lopez Obrador said in a video. He assumed his ministerial role at the start of the leftist leader's presidency on December 1.

However, markets and investors were largely supportive of Urzua's efforts to balance the public books. This was announced on Tuesday, the President of the Latin American countries, Andres Manuel Lopez Obrador.

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