Mexico peso hits 7-month low on US economy fears

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MEXICO CITY | Mon Aug 8, 2011 2:05pm EDT

MEXICO CITY Aug 8 (Reuters) - Mexico's peso slumped to a seven-month low on Monday after a downgrade of the U.S. debt rating stoked fears of a new recession in the United States that could hammer demand for Mexican exports.

The peso MXN=MEX01 shed 2.28 percent to 12.26 per dollar to trade at its weakest since Jan. 10.

The cost of dollar in pesos shot up to trade just above its 200-week simple moving average. Analysts said levels around the average may provide resistance to further peso losses. (Reporting by Michael O'Boyle)

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