Mexican bank moves to shore up slumping peso

Eric DuVall
A view of a currency exchange rate board at a bank in Mexico City on Wednesday. The U.S. dollar closed at $21.52 to the peso a new historic minimum during a tumultuous moment for the Latin American country after the withdrawal of a big investment by the automobile company Ford and the rising discomfort of citizens with the rise of fuel prices. Photo by Sáshenka Gutiérrez/European Pressphoto Agency
Mexico's central bank was active in the international currency exchange market on Thursday after the peso hung near all-time lows against the U.S. dollar, officials said.
The already weak peso was hurt further after news surfaced Ford Motor Co., was cutting a planned $1.2 billion expansion in Mexico after the move was criticized by President-elect Donald Trump. Bankers bailed on the already weak currency amid fears future business investments in Mexico would be harmed under a Trump administration.
The Wall Street Journal reported the peso was trading at $21.31 to the dollar, only a few cents off the all-time low reached Wednesday, $21.62.
In addition to the bad news from Ford, investors signaled a lack of confidence an incoming Trump administration would be friendly to Mexican business interests. Trump has vowed to renegotiate trade deals he said are unfavorable to the United States and wants to build a wall separating the two countries -- a structure he has promised he will make Mexico fund.
In addition to its activity on the exchange market, the Mexican bank raised interest rates overnight to 5.75 percent in a bid to stave off further inflation.
Mexican bank moves to shore up slumping peso Reviewed by Bizpodia on 20:16 Rating: 5

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