The Bank of Mexico (Banxico) will carry out this week a financing auction for 200 million dollars using a swap line with the United States Federal Reserve (Fed), reported the Foreign Exchange Commission.
The auction will take place on Wednesday, November 10 and will expire 84 days.
The Exchange Commission has instructed the central bank to hold auctions for financing in dollars with credit institutions in order to support liquidity conditions in the funding markets in dollars in Mexico.
On March 19, 2020 the Bank of Mexico and the Federal Reserve announced the establishment of a swap mechanism for up to 60,000 million dollars, with the objective of supporting the provision of liquidity in United States dollars.
The swap lines originally they had a duration of six months. However, the Fed has extended the term of the facility on three occasions, the latter being on June 16, when it announced that the mechanism will remain in force until December 31, 2021, the agency explained in a statement.
The Bank of Mexico has carried out 13 auctions since March 2020. To date, the current amount of financing is 100 million dollars, the Commission detailed.
“The Foreign Exchange Commission will continue evaluating the operating conditions in the foreign exchange market and, if necessary, will adopt additional actions. The Commission reiterates that the anchoring of the value of the national currency will continue to be sought mainly through the preservation of solid economic fundamentals” , said.