According to the Bank of Mexico, the Mexican peso has hit its lowest level ever against the US dollar. Trading averages 16.52 on the interbank market.
According to MetAnalisis consultant Gerardo Copca , the decline, which is only the latest string of new lows in 2015, is the result of pressure from falling oil prices with an anticipated interst rate hike in the US.
Copca also says the drop is also being influenced by the poor economic performance in China, which adds pressure to the exchange market.
Despite efforts by the Central Bank, the peso has seen a big fall this year. The bank auctioned $233 million on Wednesday, which did nothing to stop the currency from hitting a new low.
MetAnalisis statistics show the peso has depreciated 12 percent in 2015.
Copa explains that a rise in US interest rates creates a demand for the dollar in the Mexican market, strengthening the price against the local currency. He says it’s difficult to predict anything, but that the peso “could continue to depreciate.”
Bank of Mexico Gov. Agustin Carstens, said the causes for the record drop are global and external to Mexico, with the dollar strengthening against currencies in both advanced and emerging countries.
“Our country is not among those hardest hit,” he said, adding that despite the currency devaluation, Mexico is seeing low interest and inflation rates. He said the drop will be offset by financial stability and steady economic growth.