Another Peso Disaster May Be Waiting In The WingsRudi Dornbusch
You'd think that the 1994 economic crisis would have taught Mexican policymakers a lesson: Stay far away from currency overvaluation or risk financial meltdown. But no. The same strategy that led to that disaster is being used again. Instead of being allowed to float lower, the peso is being held artificially high to attract foreign capital and combat high inflation.
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