Mexican peso tumbles, stock market drops despite central bank moves to stabilize economy
Mexico's peso has tumbled to 13.6 to the dollar and the stock market dropped 7 percent, despite the central bank's actions to stabilize the economy, the Associated Press reported.
The bank has been auctioning off reserves since the peso hit a record low of 14 to the dollar this month, after trading in early August at under 10 to the dollar. It auctioned off another US$400 million early Wednesday at an average rate of 13.4 pesos to the dollar.
But the auction did little to halt the peso's fall. It was trading Tuesday afternoon at 13.6 to the dollar after running at about 13.2 hours earlier.
Mexico's central bank has vowed to auction US$400 million every day at the previous day's closing price plus 2 percent, and has converted US$12 billion to pesos since Oct. 8 in attempts to prop up the currency.