EMERGING MARKETS-Brazil real rallies in thin trade as intervention eyed
SAO PAULO, Dec 30 (Reuters) - The Brazilian real rallied on Tuesday, erasing the previous session's losses, with investors watching for an imminent announcement from the central bank over the future of its currency intervention program. Most other Latin American currencies and stock markets edged higher. The real strengthened nearly 1.8 percent, the most in nearly two weeks, partly due to traders seeking to move the so-called Ptax rate at the end of the month, which is used as a reference for a variety of currency contracts. Trading volume was low in the year-end holiday period, with most market participants awaiting an announcement from Brazil's central bank over expected modifications to its daily currency intervention program. The bank has helped support the real by providing hedging protection to local businesses via currency swaps. It remains unclear how the program will be scaled down next year, and the central bank has said it would unveil its changes in coming days. "You put together low liquidity, a fight over the end-month Ptax rate, and a lack of relevant news and the outcome is a very sensitive market," said Reginaldo Siaca, head of currency at brokerage Tov in Sao Paulo. Brazil's benchmark Bovespa stock index rose for the fifth session in six, though gains were slight. Shares of widely traded companies, such as lender Banco Bradesco SA and iron-ore mining firm Vale SA , contributed the most to the index's rise. Should the Bovespa remain at its current level of 50,750 points on Tuesday, it will close the year with a loss of about 1.5 percent. That move will be in line with predictions in a Reuters poll in September. Key Latin American stock indexes and currencies at 1324 GMT: Stock indexes daily % YTD % Latest change change MSCI Emerging Markets 954.75 -0.41 -4.39 MSCI LatAm 2745.32 0.6 -14.75 Brazil Bovespa 50789.28 0.39 -1.39 Mexico IPC - - - Chile IPSA 3855.71 0.03 4.23 Chile IGPA 18884.7 0.03 3.61 Argentina MerVal - - -100.00 Colombia IGBC 11570.54 0 -11.48 Peru IGRA - - -100.00 Venezuela IBC - - -100.00 Currencies daily % YTD % change change Latest Brazil real 2.6625 1.63 -11.48 Mexico peso 14.7406 0.20 -11.60 Chile peso 607 -0.08 -13.33 Colombia peso 2386.08 -0.31 -19.03 Peru sol 2.988 0.03 -6.53 Argentina peso 8.5500 0.03 -24.06 (interbank) Argentina peso 13.68 -2.19 -26.90 (parallel) (Reporting by Bruno Federowski; Writing by Asher Levine; Editing by W Simon)
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