Mexico's central bank announced Wednesday that it will sell $52 million per day over the next three months to stop the peso from sliding further after the currency reached historic lows.
The daily auction comes on top of a mechanism in which the bank sells $200 million on days that the peso drops by 1.5 percent from the previous day's closing price.
"The fundamental goal is to preserve the stability of the Mexican economy" and "ensure the order, the liquidity and the good functioning of the foreign exchange market," Finance Minister Luis Videgaray said in a speech.
Videgaray said the peso's depreciation was part of a global strengthening of the dollar due to market expectations that the US Federal Reserve will hike interest rates and the positive economic outlook of the United States.
The $52 million daily sale will begin Wednesday and run through June 8 in order to slow the pace of the accumulation of reserves. The $200 million mechanism has been used twice since it was launched in December.
The peso has been hitting record lows in recent weeks, reaching the lowest point since March 2009, when the country was in recession. The Mexican currency was worth 15.90 pesos against the dollar on Tuesday.
The peso has depreciated by 4.8 percent since the start of the year, Videgaray said. But it has strengthened against the euro, the Canadian dollar and the Brazilian real.
Analysts say the peso's weakening against the dollar is also due to a sharp drop in global oil prices, which have forced Latin America's second biggest economy to slash its budget and reduce its growth outlook.