Mexico takes no bids in interest rate swap

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MEXICO CITY (AP) - Mexico's central bank has turned down all bidders in a 10-billion peso auction of interest-rate swaps.

The bank says bids fell below the current market yield on 10-year bonds, suggesting the country's debt market may be stabilizing as investors bet short-term rates would fall.

Friday's auction was meant to steady the debt market, which has tightened amid the global financial crisis. Another auction is planned for Wednesday.

Mexico's peso has lost more than 25% of its value since August as capital flows dried up and investors shed assets to cover losses at home.

Mexico has sold billions of dollars of foreign reserves and bought back billions in bonds since October to boost its sagging currency and debt markets.