The U.S. dollar registered a sharp drop against the Mexican peso early on Wednesday, after the Bank of Mexico said it would up its hedges against against the U.S. currency due to market volatility. The hedges will grow by $4 billion, according to the statement. The central bank cited the volatility around the renegotiation of the North American Free Trade Agreement as well as the Federal Reserve’s monetary policy normalization as reasons. Banxico’s total $20 billion hedging program was originally announced in February. One U.S. dollar bought 19.0068 pesos on Wednesday, compared with 19.2336 pesos late Tuesday, bringing the currency pair to a two-day low.
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