MEXICO CITY, Jan 25 (Reuters) - Mexico's antitrust watchdog Cofece said on Monday that it has imposed fines totaling 35 million pesos ($1.75 million) on seven international banks and traders for market manipulation and collusion in the government bond market about a decade ago.

Cofece said Barclays, Deutsche Bank, Santander, Banamex, Bank of America, BBVA Bancomer and JP Morgan as well as 11 traders agreed on 142 instances either to sell or buy bonds at a certain price or to not trade them at all.

These agreements "had a direct impact on the price of the related instruments" it said in a statement.

The trades were made between 2010 and 2013 and caused damage estimated to be worth 30 million pesos, it added. As an example, Cofece mentioned that bonds were sold to an unnamed pension fund at a higher price.

Santander denied wrongdoing and said it would appeal while BBVA Bancomer said it would analyze its next steps. The others declined to comment.

The fines imposed on the banks were calculated using prior regulations, Cofece said, adding that current regulations would have resulted in higher fines.

Lawmaker Alfonso Ramirez, who belongs to President Andres Manuel Lopez Obrador's ruling Morena party, said last week that Cofece President Alejandra Palacios could be summoned before Congress to discuss the investigation, including whether the collusion had damaged public finances.

The multi-year investigation is one of the largest into the financial market and reflects Mexico's efforts to increase market oversight.

In 2018, Mexico's banking regulator imposed fines on some banks for manipulating operating volumes. ($1 = 20.0845 pesos) (Reporting by Abraham Gonzalez; Writing by Stefanie Eschenbacher and Cassandra Garrison Editing by Peter Graff and Sonya Hepinstall)