Strength of Peso
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In “Mexico Mustn’t Forget 1994” (editorial, Sept. 4) you assert, “Much of the strength of the peso results from Zedillo’s government playing politics through the central bank, keeping the peso high with manipulative policy tools--buying pesos, for example.” You also say that “an artificially strong peso presages serious problems for both countries.”
Please take note that the Bank of Mexico has not bought any pesos from the market since January 1996. To the contrary, the bank has been buying large amounts of foreign exchange. During this year alone, its net international assets have increased by more than $10 billion. Is this artificially making the peso strong?
EDUARDO TURRENT
Head of Press Office
Banco de Mexico
Mexico City
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