Reuters: US Dollar Report: UPDATE 1-EMERGING MARKETS-Mexico peso up, real drops on policy doubt

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UPDATE 1-EMERGING MARKETS-Mexico peso up, real drops on policy doubt Mar 16th 2013, 02:37 Tweet Share this Email Print Related Topics Currencies » Bonds News » Bonds » Markets » Fri Mar 15, 2013 10:37pm EDT * U.S. consumer sentiment tumbles to lowest in a year * Investors unsure about timing of Brazil rate hike * Colombian policymaker hints at interest rate cut * Mexico peso up on U.S. data, Brazil real drops 0.14 pct By Walter Brandimarte RIO DE JANEIRO, March 15 (Reuters) - Latin American currencies edged lower on Friday as a decline in U.S. consumer confidence weighed on the Mexican peso while doubts about future interest rate hikes in Brazil hit the real. The Brazilian real dropped 0.14 percent to 1.9840 per dollar as investors continued to digest the minutes of the central bank's latest monetary policy meeting. In the document, released on Thursday, policymakers sounded increasingly concerned about inflation but, at the same time, said they would be cautious with future policy steps due to "lingering uncertainties of external and internal origin." The minutes poured some cold water on expectations that the central bank would lift its benchmark interest rate from an all-time low of 7.25 percent - a move that could increase the allure of Brazilian assets. "Investors are still digesting the minutes," said Paulo Celso Nepomuceno, fixed-income strategist with Coinvalores brokerage in Sao Paulo. "As we haven't seen (central bank chief Alexandre) Tombini talking about it, the market remains on alert to confirm whether its interpretation of the minutes is correct." In Mexico, the peso was up 0.16 percent at 12.4150 per dollar, weighed by data showing U.S. consumer sentiment tumbled in early March to its lowest in over a year. The Mexican peso has had an impressive rally in recent sessions and the economic data from its northern neighbor, which is also the main consumer of Mexican exports, tempered investors' optimism about the currency. The Colombian peso fell 0.43 percent to 1,806.01 per dollar after a policymaker said the central bank has room to further lower its benchmark interest rate, reducing the allure of domestic assets. Latin American FX prices at 1100 GMT: Currencies daily % YTD % change change Latest Brazil real 1.9813 -0.14 -3.25 Mexico peso 12.4150 0.16 -3.36 Chile peso 471.6000 -0.06 1.51 Colombia peso 1806.0100 -0.43 -2.22 Peru sol 2.5920 0.04 -1.58 Argentina peso (interbank) 5.0900 -0.05 -3.49 Argentina peso (parallel) 8.0300 -0.50 -15.57 Tweet this Link this Share this Digg this Email Reprints We welcome comments that advance the story through relevant opinion, anecdotes, links and data. If you see a comment that you believe is irrelevant or inappropriate, you can flag it to our editors by using the report abuse links. Views expressed in the comments do not represent those of Reuters. For more information on our comment policy, see http://blogs.reuters.com/fulldisclosure/2010/09/27/toward-a-more-thoughtful-conversation-on-stories/ Comments (0) Be the first to comment on reuters.com. Add yours using the box above.

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