"We've seen a lot more carry trades as we've seen interest rates in Mexico increase," said Ron Goldshmidt, local markets trader for Latin America at UBS in Connecticut. "The country is an exporter of oil and although it may damage trade with the US, a strong oil price will generally be supportive of the peso."

Volumes in the US dollar/peso pair are sizeable at around $3–$7 billion a day, said Benito Berber, economist for Latin America at HSBC in New York. "It is by far the most important pai