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Another tweet from U.S. President-elect Donald Trump was enough to erase a central bank-induced rally in Mexico's peso.

In a very volatile session, the currency climbed as much as 1.5 percent after Banxico confirmed that it was selling dollars to bolster the exchange-rate from a record low.

Gains started to fizzle by mid-morning as some traders deemed the intervention as insufficient to contain the downward pressure.

In the afternoon, the peso erased the advance after Trump threatened Toyota with a border tax for planning to build a factory in Mexico.

Mexico's central bank sold dollars for the first time since February after the peso tumbled to the lowest level since its redenomination in 1993 amid concern over the U.S. trade policy.

The peso had weakened 3.5 percent in the past two days as Ford said it was canceling a $1.6 billion plant in Mexico. Trump thanked Ford on Twitter for "scrapping a new plant in Mexico and creating 700 new jobs in the U.S," adding "this is just the beginning."

"These Trump tweets will likely keep investors away from the peso even if authorities battle to shore it up through dollar sales," said Juan Carlos Alderete, a currency strategist at Grupo Financiero Banorte. "We continue seeing Banxico hiking by 50 basis points in February and rate hikes as the preferred measure to counter peso weakness and volatility."

The last time Banxico intervened in currency market was on Feb. 17, when it sold $2 billion directly to banks to shore up the currency hit by a global rout fueled by a plunge in oil prices.

That same day the central bank, led by Agustin Carstens, also raised the key interest rate by 50 basis points while the Finance Ministry announced budget cuts.

Banxico actions will not set a level or change the peso trend, but will result in greater market caution amid periods of extreme overshooting, BBVA analysts wrote in note to clients. Mexican authorities should consider using U.S. dollar swaps as a different intervention tool because these are "not a direct claim on reserves" and offer currency hedging protection, Goldman Sachs Chief Latin America Economist Alberto Ramos said in a note.

Banxico has a $40 billion "buffer" to intervene in the currency market and boost the peso, BNP Paribas analysts led by Gabriel Gersztein said in a note to clients. In order for the bank to be successful in intervention it should be discretionary and "more aggressive" than in 2015, they said. Mexico now has $176.5 billion in international reserves or $260 billion in total if the International Monetary Fund's flexible credit line is factored in.

The central bank was forced to raise rates five times last year and by a total of 2.50 percentage points, the most of any Group of 20 nation, as the peso depreciated the most among major currencies tracked by Bloomberg. The rate hikes were attempts to shore up Mexico's exchange rate to head off inflation.

Even so, Mexico boosted gasoline prices by as much as 20 percent on the first day of the year, the highest increase in almost two decades and stoking inflation that's already running at the fastest pace in almost two years. It's a risk Mexico is willing to take as the nation moves away from subsidies that have burnt a hole in public coffers.

Despite the efforts of Banxico, the peso continued to wither throughout 2016 as Trump gained in polls and won the U.S. election in November. Trump pledged to renegotiate or scrap Mexico's trade deal with the U.S., which receives close to 80 percent of the nation's exports. He has also promised to build a border wall and make Mexico pay for it.

Before discretionary dollar sales were put in place in February, the exchange commission, comprising officials from both Banco de Mexico and the Finance Ministry, had engaged in rules-based daily dollar auctions.