Reuters: US Dollar Report: EMERGING MARKETS-Latam currencies weaken on stimulus doubts

Reuters: US Dollar Report Reuters.com is your source for breaking news, business, financial and investing news, including personal finance and stocks. Reuters is the leading global provider of news, financial information and technology solutions to the world's media, financial institutions, businesses and individuals. // via fulltextrssfeed.com

EMERGING MARKETS-Latam currencies weaken on stimulus doubts Jul 31st 2012, 17:23 Tweet Share this Email Print Tue Jul 31, 2012 1:23pm EDT * Investors second guess ECB, Fed resolve to deploy stimulus * Brazil seen not rolling over currency swaps * Brazil real down 0.4 pct, Mexico peso falls 0.2 pct Rio de Janeiro, July 31 (Reuters) - Latin American currencies weakened on Tuesday before crucial monetary policy decisions by U.S. and European policymakers, while the Brazilian real was pressured by investors betting the central bank would not roll over swap contracts designed to boost the currency. The Mexican peso lost 0.2 percent in cautious trading as investors questioned the resolve of U.S. and European central banks to deploy more stimulus measures at the end of their monetary policy meetings this week. Expectations that such measures were in the pipeline drove risk appetite higher last week, but since Monday investors have been more cautious. Doubts on whether the European Central Bank would agree on concrete steps to cut the borrowing costs of Spain and Italy weighed on European markets on Tuesday. There were also concerns the U.S. Federal Reserve could hold off bolder stimulus measures until its September meeting. "Investors have been expecting actions by the ECB and the Fed, but with the latest U.S. economic data coming in line or better than expected, some are already ruling out measures to stimulate the economy this week," said Luiz Roberto Monteiro, a trader with Renascenca brokerage in Sao Paulo. The Brazilian real fell 0.4 percent, also pressured by bets that the central bank would let expire $4.57 billion worth of swap contracts due on the following day, essentially reducing the supply of dollars in the futures market. "The real would gain if the central bank rolled over those contracts, so I think it will not do that," said Ovidio Soares, a trader with Interbolsa brokerage. He noted that Brazilian policymakers, seeking to protect exporters, do not want the real to strengthen past 2 per dollar. The real last traded at 2.0463 per greenback, after closing at 2.0208 on Friday, its strongest level in three weeks. Latin American FX prices at 1555 GMT Currencies daily % YTD % change change Latest Brazil real 2.0463 -0.42 -8.69 Mexico peso 13.2901 -0.21 5.11 Argentina peso* 6.3300 0.63 -25.28 Chile peso 482.2500 0.07 7.68 Colombia peso 1,791.3500 -0.03 8.21 Peru sol 2.6280 0.00 2.63 * Argentine peso's rate between brokerages Tweet this Link this Share this Digg this Email Reprints Comments (0) Be the first to comment on reuters.com. Add yours using the box above.

You are receiving this email because you subscribed to this feed at blogtrottr.com. If you no longer wish to receive these emails, you can unsubscribe from this feed, or manage all your subscriptions