Mexican currency drops against dollar as Spain, Italy concerns rear

Posted On: September 18, 2012
Latin America's most traded currency lost slight ground on Tuesday as concerns reared about debt-hobbled euro zone nations, which drew down the allure of assets from emerging markets, Reuters reports.

The Mexican peso slipped against the world's reserve currency amid investor concern for the sovereign debt crisis worsening should Spain postpone solicitations for bailout aid, which is considered inevitable for the nation's weakened bank and public finance systems. One currency director also pointed to Italy, another nation that is drawing concern for its fiscal state in the face of the sovereign debt crisis.

"What we're seeing is profit taking triggered by concerns over Spain and Italy," currency director Juan Carlos Pina with Intercam brokerage in Mexico told Reuters, noting some missing economic data has left the market more prone to volatility among investors.

Spain and Italy have been unable to escape the shadow of the sovereign debt crisis as the two nations have put effort into reducing government bond yields. But the yields consistently rise.

Tuesday's losses for the peso mark the monetary unit's second consecutive day of losses against the U.S. dollar, according to Bloomberg.

Category: Industry News

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