IDEAS home Printed from https://ideas.repec.org/a/ysm/ypfsfc/v5y2023i1p580-614.html
   My bibliography  Save this article

United States: Swaps to Mexico, 1994

Author

Listed:

Abstract

In 1994 and 1995, Mexico faced a series of economic and financial disruptions that led it to repeatedly seek financial assistance from the United States and international financial organizations. This case study describes three episodes during which the US government used currency swap facilities to provide dollar funding to the Bank of Mexico (BoM), similar to Mexico's 1982 crisis: (1) a temporary bilateral swap line established by the Federal Reserve and the Treasury on March 24, 1994, to provide emergency support following a political assassination, which the BoM did not draw upon; (2) a trilateral swap arrangement under the North American Framework Agreement (NAFA) among the US, Mexico, and Canada, which the BoM did draw upon and which remains in place; and (3) a USD 20 billion assistance package in February 1995, which included the exercise of existing short-term swap lines, medium-term swaps, and guarantees. The United States disbursed a total of USD 13 billion from this assistance package. The Bank of Mexico repaid all amounts by January 1997.

Suggested Citation

  • Swaminathan, Lakshimi & Wiggins, Rosalind, 2023. "United States: Swaps to Mexico, 1994," Journal of Financial Crises, Yale Program on Financial Stability (YPFS), vol. 5(1), pages 580-614, July.
    • Handle: RePEc:ysm:ypfsfc:v:5:y:2023:i:1:p:580-614
    as

    Download full text from publisher

    File URL: https://elischolar.library.yale.edu/cgi/viewcontent.cgi?article=1502&context=journal-of-financial-crises
    Download Restriction: no
    ---><---

    More about this item

    Keywords

    foreign currency swap; liquidity; Mexico; NAFA; NAFTA;
    All these keywords.

    JEL classification:

    • G01 - Financial Economics - - General - - - Financial Crises
    • G28 - Financial Economics - - Financial Institutions and Services - - - Government Policy and Regulation

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:ysm:ypfsfc:v:5:y:2023:i:1:p:580-614. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    We have no bibliographic references for this item. You can help adding them by using this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: the person in charge (email available below). General contact details of provider: https://edirc.repec.org/data/smyalus.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.