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Mexico’s Peso Slumps as Pena Nieto Said to Delay Energy Overhaul

Mexico’s peso weakened for the first time in four days as President Enrique Pena Nieto pushed back the announcement of a proposal to overhaul the energy industry.

The peso slumped 0.6 percent to 12.7011 per dollar at 9:44 a.m. in Mexico City. Yields on Mexican government peso bonds maturing in 2024 rose three basis points, or 0.03 percentage point, to 5.87 percent, according to data compiled by Bloomberg.

A person briefed on Pena Nieto’s energy proposal said he would delay its release until next week, instead of today, as lawmakers extend negotiations. People familiar with the matter had said it would seek to bolster growth and lure investment by amending the constitution to break Petroleos Mexicanos’s monopoly on oil exploration and production. Mexico’s currency and debt had rallied this month amid bets that Congress would approve the measure.

“Postponing it is seen in a very bad light,” said Roberto Galvan, a currency trader at Intercam Casa de Bolsa SA in Mexico City. “Everyone expected that today it would be presented and that it was all good. To not do it, the market is wondering if they’re just playing around.”

Francisco Arroyo, a lawmaker with Pena Nieto’s ruling party and speaker of the lower house said in an interview with Radio Formula that “they’re making the last adjustments and I understand that with the intention of having the broadest consensus possible.”

The peso’s selloff today is the biggest among 16 major currencies tracked by Bloomberg.

To contact the reporter on this story: Ben Bain in Mexico City at bbain2@bloomberg.net

To contact the editor responsible for this story: David Papadopoulos at papadopoulos@bloomberg.net

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