Reuters: US Dollar Report: EMERGING MARKETS-Brazil real gains on Fed bets, Mexico peso weaker

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EMERGING MARKETS-Brazil real gains on Fed bets, Mexico peso weaker Sep 10th 2012, 22:19 Tweet Share this Email Print Mon Sep 10, 2012 6:19pm EDT * Investors cautious ahead of Fed statement on Thursday * Chinese trading data underscores weak economy, stimulus hopes * Brazilian real 0.2 pct stronger, Mexican peso drops 0.8 pct By Natalia Cacioli SAO PAULO, Sept 10 (Reuters) - The Brazilian real edged up on Monday on expectations the U.S. Federal Reserve could unveil further stimulus measures this week but the Mexican peso traded off four-month highs as weak Chinese data added to global growth concerns. Hopes that the Fed would announce a third-round of its bond-buying program increased after poor U.S. payrolls data on Friday, when Brazilian markets were closed for a national holiday. U.S. monetary stimulus measures usually translate into additional dollar inflows to emerging economies. The real rose 0.2 percent as it caught up with gains recorded by other Latin American currencies on Friday. Market sentiment was weak, however, after Chinese trade data came in below forecasts, underscoring a weak global economy. Imports fell 2.6 percent on the year in August, confounding expectations of a 3.5 percent rise. Exports grew 2.7 percent, below forecasts for a 3 percent rise in a Reuters poll. "Expectations for Fed stimulus are having a larger impact (on the real) than the Chinese data," said Mauricio Nakahodo, an economic research consultant with Tokyo-Mitsubishi bank in Sao Paulo. "But I believe that the real can start tracking external markets as the session goes by." Markets were trading cautiously overseas. The euro was 0.1 percent weaker against the dollar, as investors await the Fed's key monetary policy statement on Thursday and a crucial ruling by a German constitutional court on the euro zone's new bailout fund. The Mexican peso, Latin America's most traded currency, weakened 0.78 percent to 13.0775. The weak Chinese data was positive for commodities and for the Chilean peso, however, as it reinforced expectations of additional economic stimulus there. Chile's currency gained 0.15 percent to 475.00. China's infrastructure push is good news for economies that produce raw materials used to make steel and other construction materials. The Chilean peso gained 0.2 percent as prices of copper, the country's main export product, hit a four-month high in London. Latin American FX prices at 1605 GMT: Currencies daily % YTD % change change Latest Brazil real 2.0231 0.19 -7.64 Mexico peso 12.9920 -0.12 7.52 Argentina peso* 6.3100 0.32 -25.04 Chile peso 474.9000 0.17 9.35 Colombia peso 1,800.4500 0.02 7.66 Peru sol 2.6080 0.00 3.41 * 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.

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