Mexico: Mexican peso depreciates in December
January 1, 2012
The prospects of a protracted European debt crisis and slower global growth continue to weigh on the Mexican peso. On 30 December, the final trading day of the year, the Mexican currency fell to 13.95 MXN per USD, which represents a 2.2% nominal depreciation over the 13.64 MXN per USD. As a result, the peso accumulated a 6.4% nominal depreciation in full year 2011. Despite the sustained depreciation, both the Central Bank and Consensus Forecast panellists remain confident that the Mexican peso will recover part of the lost ground in the months ahead. Moreover, the Bank has announced its willingness to prevent sharp exchange rate fluctuations and currently enjoys ample margin for manoeuvre, with foreign exchange reserves closing the year at a record-high of USD 142.5 billion.