Mexico central bank sells US$107 mln to support peso

Latin American currencies fell on Tuesday after China's decision to devalue the yuan by nearly 2 percent fueled a sharp drop in commodities prices.
(Photo: Reuters)
11/08/2015
10:01
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Mexico's central bank on Tuesday said it sold US$107 million of US$200 million offered in an auction to support the peso currency at an average price of 16.3274 pesos per dollar. 

Latin American currencies fell on Tuesday after China's decision to devalue the yuan by nearly 2 percent fueled a sharp drop in commodities prices as well as concerns about the competitiveness of emerging market exporters.

Latin America's most traded currencies - including those of Mexico, Brazil, Chile, and Colombia - all dropped about 1 percent following the Chinese move, which raised questions about Beijing's commitment to a strong yuan as part of a strategy to stimulate domestic consumption rather than exports.

"China's unexpected currency devaluation is driving broad-based risk aversion across markets as participants consider its implications for global commodity demand, inflation, and the balance of risks to growth," analysts with Scotiabank wrote in a report.

 

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