Banxico’s Carstens: Trump's tweets modified peso strategy

Mexican Central Bank, Banco de Mexico (Banxico), chief Agustin Carstens crossed the wires last minutes, via Reuters, commenting on the impact of two tweets by the US president Trump.

Key Points:

In early January the Banco de Mexico had intervened to sell USD & buy MXN

To counter the peso's nosedive to record lows amid fears of Trump protectionist policy

"I'll say it like this, in simple terms: with two tweets from you know who, the effect (of that intervention) vanished”

"It was precisely then we thought that instead of using hard currency like dollars, it would be better to move to a scheme in which there was the possibility of offering hedges" without having to eat into Mexico's currency reserves”