UPDATE 2-Mexico Finance Minister Urzua quits, Herrera named successor

Mexico's moderate Finance Minister Carlos Urzua resigned on Tuesday, citing deep differences over economic issues, in a blow for the government of President Andres Manuel Lopez Obrador, who named a well-regarded deputy minister to replace him.

"Differences on economic issues, there were many. Some of them happened because in this administration public policy decisions were made without sufficient foundation," Urzua wrote in a scathing letter posted on Twitter. The Mexican peso fell over 2% on the news and the benchmark index slid almost 1.5%.

Lopez Obrador quickly promoted Deputy Finance Minister Arturo Herrera to the top job. Herrera is well known to investors and seen as a competent economic manager. Investors have worried about Lopez Obrador's policy direction since he canceled a major airport project before taking office, and the government has clashed with businesses on a number of occasions.

Urzua cited "extremism" as a reason he felt forced to quit. "I'm convinced that economic policies should always be evidence-based, careful of their potential impacts and free of extremism, either from the right or the left. However, these convictions did not resonate during my tenure in this administration," Urzua said.