(Adds closing peso price, adds quote)
By Jean Luis Arce
MEXICO CITY, Sept 16 The battered Mexican peso
closed at a record low on Friday, creeping ever closer to the
key 20 pesos per dollar psychological barrier, after data showed
U.S. consumer prices increased more than expected in August.
The peso, which has dropped just under 14 percent so far
this year, ended the day down 1.33 percent at 19.6200 pesos to
The peso also reached a record intraday low of 19.777 pesos
per dollar, surpassing its previous nadir on June 24, the day
after Britain voted to leave the European Union.
The U.S. data points to a steady build-up of inflation that
could prompt the Federal Reserve to raise interest rates this
year, and drive outflows from Mexican assets.
"This is the beginning of volatility in both directions,"
Nomura Securities analyst Benito Berber said. "It's not unlikely
that we will see the peso below 19 or above 20."
The upcoming poll numbers of Democratic presidential
contender Hillary Clinton and her Republican counterpart Donald
Trump will also affect the peso's trajectory, Berber added.
The peso has weakened nearly 4.5 percent this month on
concerns that Trump could win the Nov. 8 U.S. election after
polls showed him gaining ground against Clinton.
Late on Thursday, the deputy governor of the Bank of Mexico,
Manuel Sanchez, said the bank would pay close attention to
inflationary pressures stemming from the weak peso while
deciding monetary policy.
Mexican markets were closed on Friday for a national holiday
the peso continued to be traded.
(Reporting by Jean Luis Arce; Editing by Bill Trott and Richard