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Peso Hits Record Low After UK’s Brexit Vote

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peso 400x264Britain's vote to leave the European Union triggered a 7% fall and more spending cuts

The peso plunged 7.1% against the dollar to a record low in overnight trading after the U.K. voted for Brexit, the referendum that asked voters if the U.K. should remain in the European Union.

The vote sparked the peso’s biggest drop, to 19.5187 to the dollar, since 2009, after having climbed 1.43% since June 9 on speculation that British voters would opt to remain within the EU.

The peso regained slightly this morning, trading at 18.7612 in New York, reported Bloomberg.

The Finance Secretariat reacted this morning with the announcement of more spending cuts in the expectation of greater volatility in international financial markets.

Finance Secretary Luis Videgaray told a press conference that federal spending would be cut by 31.715 billion pesos (about US $1.7 billion).

Bloomberg said that among 24 emerging-market currencies the Mexican peso has been the second-worst performer against the dollar this year after falling 8.4%.

 

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