Mexico’s peso fell to a record low after the government signaled more spending cuts, further damping the outlook for Latin America’s second-biggest economy.
The peso dropped 0.7 percent to 18.8029 per dollar as of 10 a.m. in Mexico City, the most among 16 major currencies tracked by Bloomberg. Its 8.5 percent slide since the end of December marks the worst start to any year since the 1993 redenomination.
Mexico has been caught up in a global currency rout as oil plunges and concerns over the health of the global economy deepen. The plunge in crude, which has already spurred a decline in public spending after revenue from state-owned Petroleos Mexicanos tumbled, also means that Mexico needs to prepare itself for preventative spending cuts for next year, Finance Minister Luis Videgaray said Monday in a radio interview. The oil company, known as Pemex, also needs to reduce spending, Videgaray told Radio Formula.