Sept. 6 (Bloomberg) -- Mexico’s peso rose to a four-month high as European Central Bank President Mario Draghi said policy makers agreed to an unlimited bond-purchase program, boosting optimism for progress in stemming the debt crisis.
The peso appreciated 0.5 percent to 13.0563 per dollar at 4 p.m. in Mexico City after touching 13.0285 in intraday trading, the strongest level since May 4. It was the currency’s fifth consecutive daily gain and pushed this year’s rally to 6.7 percent, the biggest among the dollar’s 16 most-traded counterparts tracked by Bloomberg.
The peso strengthened with most other emerging-market currencies after Draghi said the ECB will target government bonds with maturities of one to three years as part of an effort to save the euro.
“The peso is rising due to a bullish perspective for what the ECB could do in the near future,” Ramon Cordova, a currency trader at Banco Base SA in San Pedro Garza Garcia, Mexico, said in a phone interview. “It’s the asset that a lot of people use to hedge their exposure to Latin American assets.”
The yield on Mexican local-currency bonds due in 2024 rose five basis points, or 0.05 percentage point, to 5.58 percent, according to data compiled by Bloomberg. The price declined 0.58 centavo to 139.16 centavos per peso.
To contact the editor responsible for this story: David Papadopoulos at email@example.com