EMERGING MARKETS-Latam currencies sink on oil prices, Brazil swaps outlook
SAO PAULO, Nov 28 (Reuters) - Latin American currencies weakened sharply on Friday after a drop in oil prices weighed on the economic outlook for petroleum-producing countries, while Brazil investors kept their eye on possible modifications to the central bank's currency intervention program. OPEC decided not to cut output at a Thursday meeting, driving Brent crude oil prices to a four-year low on Friday and reinforcing expectations for a global oil-supply glut. The decision hurt the currencies of countries such as Colombia, Brazil and Mexico, all of which are oil exporters. Colombia's peso posted the sharpest loss in the region, weakening about 2 percent against the dollar to its lowest point in over five years. "The key question is whether or not the Colombian peso will continue its depreciation," wrote Nomura analyst Mario Castro in a client note. "The answer is yes, in our view. The key is the rapid deterioration of Colombia's balance of payments." Mexico's peso weakened for the fifth straight day and was set to close the session with its worst weekly drop in over a year. Brazil's currency, the real, notched its biggest one-day decline in over three weeks. Traders said part of the real's losses were due to uncertainty over the central bank's willingness to defend the currency after the bank's president, Alexandre Tombini, said the existing stock of currency swaps "significantly" satisfies market demand for hedging protection. Meanwhile, Chile's peso sank after prices for copper , the country's main export, touched their lowest since March. Key Latin American stock indexes and currencies at 1603 GMT: Stock indexes daily % YTD % Latest change change MSCI Emerging Markets 1004.38 -0.81 0.99 MSCI LatAm 3018.88 -2.14 -3.63 Brazil Bovespa 54877.91 0.29 6.54 Mexico IPC 44362.53 -0.73 3.83 Chile IPSA 4001.92 0.52 8.18 Chile IGPA 19491.86 0.44 6.94 Argentina MerVal 9737.52 -3.8 80.62 Colombia IGBC 12049.38 -1.61 -7.82 Peru IGRA 15124.1 -0.75 -4.00 Venezuela IBC 2991.17 -0.32 9.30 Currencies daily % YTD % change change Latest Brazil real 2.5743 -1.80 -8.45 Mexico peso 13.8977 -0.98 -6.24 Chile peso 607.8 -1.17 -13.44 Colombia peso 2210.1 -2.17 -12.58 Peru sol 2.92 -0.41 -4.35 Argentina peso 8.5225 0.00 -23.82 (interbank) Argentina peso 13.1 0.76 -23.66 (parallel)
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