Reuters: US Dollar Report: EMERGING MARKETS-Latin American currencies firm on Greece deal

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EMERGING MARKETS-Latin American currencies firm on Greece deal Nov 27th 2012, 16:58 Tweet Share this Email Print Tue Nov 27, 2012 11:58am EST * Analysts speculate on new trading range for Brazil real * Mexican peso stumbles at 50-day moving average * Brazil real firms 0.3 pct, Mexico peso up 0.33 pct MEXICO CITY, Nov 27 (Reuters) - Latin American currencies moved higher on Tuesday after an international deal to keep debt-laden Greece afloat lifted demand for riskier assets around the world. The Brazilian real bid 0.3 percent stronger at 2.0755 per dollar. The currency bounced back from a 3-1/2 year low last week after the central bank intervened in the market to halt a steep slump in the real against the dollar. Analysts said authorities may be leaning toward allowing for a weaker currency to support exporters. Brazilian policymakers have used both verbal and market intervention to keep the real largely within a range of 2 per dollar to 2.05 since July. "Maybe the government intends to promote a slightly larger band, between 2.05 and 2.15 reais, but without abrupt movements," said Mauricio Nakahodo, an analyst the Bank of Tokyo-Mitsubishi, who said the central bank acted on Friday due to the magnitude of the loss, not a specific level. Broadly supporting demand for riskier assets, international lenders agreed on Tuesday on a package of measures to reduce Greek debt that paves the way for the release of urgently needed loans to Greece. Mexico's peso gained 0.33 percent to 12.9790 per dollar as the currency struggled to break past the 13 per dollar level. The peso has firmed more than 2 percent from a 2-1/2 month low hit earlier this month, supported by optimism on fiscal negotiations in the U.S. Congress. But sentiment on the U.S. talks could easily reverse, analysts said, as lawmakers prepared to resume budget negotiations this week in Washington. The cost of dollars in pesos hit support at the 50-day moving average around 12.96 per dollar. Traders said the peso would need to firm past 12.95 per dollar in order for its advance against the dollar to pick up more momentum. "The tone is cautious," said Alfredo Puig, a trader at brokerage Vector in Monterrey, Mexico, "But it still looks like the peso could keep gaining." Latin American currencies at 1600 GMT Currencies daily year-t % -date Latest change % change Brazil real 2.0755 0.30 -9.97 Mexico peso 12.9790 0.33 7.63 Argentina peso* 6.4400 0.31 -26.55 Chile peso 480.3000 0.25 8.12 Colombia peso 1,823.400 0.02 6.31 Peru sol 2.5870 0.04 4.25 * 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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