Mexico's Finance Minister Ernesto Cordero said on Friday that Asian investors have sunk about $9 billion into Mexican bonds since March, when it was announced the country would be added to a major bond index. Mexico is the first Latin American country to be added to Citigroup's index, which is mostly made up of debt from developed economies. The index is used by some investors to distribute investments across countries.
Flows into the currency market from WGBI investors - or by speculators betting on those flows - helped drive Mexico's peso to a three-month high against the dollar in September. Many Japanese passive fund managers are expected to take exposure to Mexican bonds, while active fund managers are less keen about investing in them due to a lack of convincing fundamentals and uncertainty about the outlook for the peso.