November 11, 2016 / 12:16 PM / 3 years ago

Mexican market woes deepen as peso hits fresh low, bonds slump

LONDON, Nov 11 (Reuters) - Mexico’s peso slumped 3 percent to a fresh record low on Friday and its government bonds took a beating as the country remained at the centre of market jitters about the impact of Donald Trump’s victory in U.S. elections.

The peso has become a lightning rod for market anxiety due to fears about the future of Mexican-U.S. trade relations. The currency had slumped through 21 per dollar to almost 21.2 by 1200 GMT, down over 10.5 percent for the week.

Mexico’s main government dollar-bonds fell sharply too, dropping as much as 2.5 cents to their lowest level since February.

European-listed exchange traded funds for Mexican stocks also felt the heat, dropping as much as 6 percent.

The moves have led a widespread selloff across emerging markets as world borrowing costs have spiked sharply on bets a mass infrastructure drive from Trump could push up inflation.

The dollar has also seen its biggest rise in a year which adds pressure to countries that borrow heavily in the greenback but get tax revenues in their own currencies. (Reporting by Marc Jones; editing by Karin Strohecker)

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