EMERGING MARKETS-Latam currencies fall; Mexican, Colombian pesos hit record lows
(Adds closing prices, details on Colombian peso) SAO PAULO, Dec 11 (Reuters) - Latin American currencies weakened on Friday after slides in oil prices and China's yuan sent investors scurrying for the safety of the dollar, dragging the Mexican and Colombian pesos to record lows. The yuan fell to its lowest in more than four years, raising expectations that Beijing could allow an even larger depreciation as the economy shows increasing signs of weakness. The move was followed by a slump in the Mexican peso to an all-time low at 17.44 per dollar. Also pressuring the currency was a drop in crude prices to their lowest in seven years, amid concerns about global oversupply. At the close of local trading, the Mexican currency was down 1.12 percent on Friday at 17.394 pesos per dollar. Under pressure from the same quarters, Colombia's peso closed down 2.52 percent at a new low of 3.328 per dollar. Investors also braced for an expected U.S. interest rate increase next week, which could pull investments away from high-yielding emerging market assets. Some traders were comforted, however, by signs that the Federal Reserve, the U.S. central bank, will tighten monetary policy slowly from then on. The Brazilian real closed down 1.92 percent at 3.8738 per dollar, hit by media reports saying Finance Minister Joaquim Levy threatened to leave his post if Congress lowered the country's fiscal target for 2016. Levy has spearheaded efforts to cut spending and raise taxes in order to regain investor trust and fight a worsening recession. Traders worried that his exit could herald a return to the interventionist policies adopted during President Dilma Rousseff's first term in office. Latin American stock indexes at 2200 GMT: Stock indexes Latest Daily YTD pct pct change change MSCI Emerging Markets 773.56 -1.96 -19.11 MSCI LatAm 1,856.54 -3.03 -31.94 Brazil Bovespa 45,262.72 -0.81 -9.49 Chile IPSA 3,533.07 -0.88 -8.25 Chile IGPA 17,493.78 -0.75 -7.30 Argentina MerVal 12,779.23 -2.49 48.96 Colombia IGBC -0.75 -31.51 7,968.98 Venezuela IBC 15,005.31 0.81 288.87 (Reporting by Bruno Federowski and Nelson Bocanegra; Editing by Meredith Mazzilli and James Dalgleish)
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