Mexico buys back US$3 billion in government debt to boost liquidity
Mexico is buying back US$3 billion in 10- to 30-year fixed rate government bonds to boost liquidity, the Associated Press reported.
Credit lines have seized as foreign investors pull assets from Mexico to cover losses at home. The Mexican peso has lost more than 25 percent of its value since August, causing companies to post huge losses on currency bets.
Those bets have further dried up already tight credit markets.
The Treasury Department said Thursday that it will buy back bonds early, injecting cash into the Mexican credit market.
The buy-back plan is in addition to Monday's announcement by the central bank to buy back as much as 150 billion pesos (US$18 billion) in government debt related to a 1990s bank rescue.