EMERGING MARKETS-Latam currencies surge on dovish Yellen, oil price rise
(Updates with closing prices)
By Bruno Federowski
SAO PAULO, June 7 (Reuters) - Latin American currencies strengthened on Tuesday, helped by a rise in oil prices and comments from U.S. Federal Reserve Chair Janet Yellen in which she refrained from setting a time frame for further interest rate hikes.
In a speech on Monday, Yellen did not repeat her assessment that rate increases would be appropriate in coming months. Nevertheless, she gave a largely upbeat assessment of the U.S. economy and indicated further hikes were coming.
Emerging market currencies tend to benefit from low interest rates abroad, which often drive foreign investors toward high-yielding bonds.
A rally in oil prices to eight-month highs after a spate of attacks on infrastructure in Nigeria depressed crude supply.
The Colombian peso shot up 2.57 percent, its biggest daily gain in nearly three months, while the Mexican peso rose the most in nearly four months, jumping 1.65 percent.
The Colombian peso had been pressured after the country's central bank backed off its intervention policy. However, bets that the bank could increase rates to fight currency weakness grew following a report showing inflation kept rising well above its long-term target.
The Brazilian real strengthened more than 1 percent after central bank chief nominee Ilan Goldfajn defended the country's floating exchange rate in a Senate hearing. Continuación...