Mexican leftist’s adviser seeks to calm nerves before vote

FILE PHOTO: Mexico's presidential front-runner Andres Manuel Lopez Obrador of the National Regeneration Movement (MORENA) addresses supporters in Oaxaca, Mexico June 16, 2018. REUTERS/Jorge Luis Plata

By Dave Graham

MEXICO CITY (Reuters) – Leading presidential candidate Andres Manuel Lopez Obrador would seek to increase investor confidence in Mexico to strengthen the peso and could hold auctions of oil rights, a top adviser said on Monday, striking a moderate tone days before the election.

Leftist Lopez Obrador is leading ahead of Sunday’s vote and Alfonso Romo, his top business adviser, told reporters a Lopez Obrador government will do everything it can – short of intervention – to help the peso.

Romo, Lopez Obrador’s nominee for chief of staff, said his government would seek to strengthen the rule of law and create business conditions that would give investors confidence in order to support the Mexican currency.

He echoed other advisers, saying Lopez Obrador would respect the independence of the central bank.

Mexico’s peso sank to a 1-1/2 year low this month, hit by a broad dollar rally, a deadlock in talks to rework the NAFTA trade deal and nervousness ahead of the election.

Lopez Obrador, 64, is an anti-system third-time presidential candidate who promises to clean up corruption. Some of his proposals, such as suspending oil auctions, have unnerved investors.

The former Mexico City mayor holds a commanding double-digit lead in all major opinion polls, although one survey on Monday showed his lead narrowing slightly, to 12 points.

Romo sought to calm any jitters on Monday, saying there could be more auctions of oil drilling rights as long as a review of contracts that have already been awarded to private companies showed no problems.

“We will revise them and everything good will remain,” he said, noting Lopez Obrador had taken the same message to investors in New York.

Romo said such a review should be finished quickly, ideally by October, during the transition period before Mexico’s next president takes office in December.

Romo said he felt “at ease” with what he had reviewed so far regarding the landmark energy opening under current President Enrique Pena Nieto.

(Reporting by Dave Graham; Writing by Michael O’Boyle; Editing by Frank Jack Daniel and Dan Grebler)