| | |  Business News | October 2008 
Mexico Auctions Six Bln Dollars to Fight Peso's Fall
 Agence France-Presse
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| | A view of the Mexican Stock Exchange. Mexico's Central Bank said it had auctioned six billion dollars Friday, in two sales of three billion dollars, in the latest move to support the tumbling peso.
(AFP/File/Carlos Cazalis) | | |
Mexico City - Mexico's Central Bank said it had auctioned six billion dollars Friday, in two sales of three billion dollars, in the latest move to support the tumbling peso.
"The Bank of Mexico today auctioned three billion dollars at an exchange rate of 12.76 to the dollar," the bank said on its website.
It earlier sold off three billion dollars at 12.86 to the dollar, in the latest Central Bank auctions, which began on Wednesday.
Mexico's economy, closely tied to that of the neighbouring United States, had suffered relatively few bumps from the global crisis until the peso began to nosedive.
The Mexican peso opened trade Friday at 13.08 to the dollar after plunging to a record low in late trading Thursday, changing hands at 12.80.
It closed at 12.45 the previous day, despite the first dollar auctions.
The peso initially rose Wednesday after the bank sold 998 million dollars, but it fell 2.8 percent Thursday, after the bank auctioned off a further 1.5 billion dollars.
The Central Bank also injected 400 million dollars into the market Friday, part of a temporary daily mechanism announced Wednesday.
The Mexican stock exchange sunk 4.14 percent at midday Friday, compared with the previous day, despite the Central Bank move.
The leading indicator of the Bolsa Mexicana de Valores (BMV) was down 840.42 points to 19,469.78.
After hovering below 11 pesos to the dollar for the past year, the peso began to depreciate significantly on September 29.
The Mexican stock exchange then registered its biggest fall in eight years, following the rejection by the US Congress of a first financial rescue plan.
Mexico, Latin America's second biggest economy, depends on the United States for 80 percent of its exports and most of its remittances, its second-largest source of foreign income after oil exports. |
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