Tuesday saw Latin America's most traded currency drive to its top price in 30 days as a consequence of a strong debt auction in Spain where investors overlooked downgrades to credit ratings of Spain and eight additional euro zone nations, according to Bloomberg.
Given the overhang of last week's Standard & Poor's credit downgrade, the healthy auction in Spain imbued an optimism for world development and growth while the Mexican peso benefited as well. The Mexican economy trails only that of Brazil for Latin America's most rapidly growing system.
"Mexican assets are taking advantage of the recent economic improvement we're seeing in the U.S., and at the same time, Europe debt crisis impact seems less damaging," economist Alejandro Padilla with Banorte told Dow Jones Newswires.
Tuesday's sale in Spain gravitated toward the top end of the target range by pulling down the euro-equivalent of more than $6.2 billion in treasury bills for 12- and 18-month bonds. Bond yields at Tuesday's sale were significantly lower than the most recent bond sale in Spain.
France, which is one of the nine nations to suffer Standard & Poor's downgrade, conducted an auction that resulted in yields of 3.015 percent on 10-year government bonds.
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