EMERGING MARKETS-Latam currencies weaken on China, N. Korea worries
By Bruno Federowski SAO PAULO, Jan 6 (Reuters) - Latin American currencies weakened on Wednesday as investors fretted over economic weakness in China and a nuclear test by North Korea. The People's Bank of China allowed the yuan to weaken to a record low, fueling fears that the world's second biggest economy could be weaker than perceived. Data on Wednesday showed activity in China's services sector expanded at its lowest pace in 17 months in December. "Investors are worried about what is going on in China," Guide Investimentos analysts wrote in a client note. Traders also avoided risky bets after North Korea said it successfully tested a miniaturized hydrogen nuclear bomb on Wednesday. The news added to geopolitical risk, reducing demand for high-yielding emerging market assets. The Brazilian real weakened 1 percent, while the Mexican peso fell to its lowest rate against the U.S. dollar in three weeks. The Colombian peso dropped 1.1 percent, tracking a decline in oil prices to a new 11-year low as a row between Saudi Arabia and Iran reduced the chances of coordination to cut output. Latin American stock indexes and currencies at 1415 GMT: Stock indexes daily % YTD % change change Latest MSCI Emerging Markets 759.47 -1.17 -3.23 MSCI LatAm 1755.02 -1.15 -2.97 Brazil Bovespa 41756.78 -1.56 -3.68 Chile IPSA 3612.99 -0.36 -1.83 Chile IGPA 17860.17 -0.31 -1.60 Currencies daily % YTD % change change Latest Brazil real 4.0340 -1.06 -34.12 Mexico peso 17.4425 -0.64 -15.47 Chile peso 716 -0.31 -15.31 Colombia peso 3247.38 -1.14 -26.46 Peru sol 3.4171 -0.14 -12.82 Argentina peso (interbank) 13.8900 -1.80 -38.44 Argentina peso (parallel) 14.35 -0.42 -2.44 (Reporting by Bruno Federowski; Editing by Nick Zieminski)
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