LatinNews Daily - 02 February 2021

In brief: Banxico governor warns on proposed bank reform in Mexico

* The governor of Mexico’s central bank (Banxico), Alejandro Díaz de León, has warned that a controversial bill approved by the senate at the end of last year, requiring Banxico to buy excess US dollars in the Mexican financial system, would weaken its ability to manage the exchange rate. Speaking in a virtual session before the bicameral federal legislature, Díaz said that this in turn could affect the perception of sovereign risk and damage the country’s credit ratings as well as raise the risk of the Mexican peso depreciating. The bill, which Banxico has previously warned increases the risk that the bank could run afoul of international anti-money laundering regulations, awaits ratification by the lower chamber of congress.

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