By Valerie Rota
Oct. 23 (Bloomberg) -- Mexico's peso traded near a record low amid a decline in most emerging-market currencies and global stocks as investors pulled out of higher-yielding assets.
Yields on Mexico's benchmark peso-denominated bond rose for an eighth trading day, reaching a 3 1/2-year high. Standard & Poor's lowered Russia's credit rating outlook to negative, while Argentine lawmakers battled to block President Cristina Fernandez de Kirchner from seizing privately managed pension funds as the government struggles to avert its second default this decade.
``Risk aversion is very strong,'' said Benito Berber, a macro strategist with RBS Greenwich Capital Markets Inc. in Greenwich, Connecticut. This makes investors ``run towards the dollar at any price.''
The peso fell as much as 3 percent to 14.3017 per U.S. dollar, from 13.879 yesterday. It traded at 12.3259 at 10:17 a.m. New York time. Mexico's peso has fallen 26 percent since touching a six-year high on Aug. 4, joining a decline in all but two of the 26 most-traded emerging-market currencies, the Hong Kong dollar and the Chinese yuan.
Mexico's peso rebounded, rising as much as 2.3 percent, after the Brazilian central bank bought the real in a bid to stem a two-month rout, said Omar Martin del Campo, a currency trader at Banco Ve Por Mas SA in Mexico City. Brazil's real rose 2.3 percent, snapping two days of declines.
Yields on Mexico's 10 percent bond due in December 2024, the country's most-actively traded security in pesos, rose 27 basis points, or 0.27 percentage point, to 10.92 percent, its highest since May 2005. The yield has climbed 2.02 percentage points since Oct. 13. The bond's price fell 1.94 centavo to 93.03 centavos per peso today, according to Banco Santander SA.
To contact the reporter on this story: Valerie Rota in Mexico City at vrota1@bloomberg.net.
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