EMERGING MARKETS-Latam currencies weaken on commods prices, Fed outlook
SAO PAULO, Dec 2 (Reuters) - All major Latin American currencies weakened against the dollar on Tuesday, with investors eyeing slipping commodities prices and the outlook for higher U.S. interest rates ahead. The region's stock markets were mostly lower, with the broader MSCI Latin American stock index down less than 1 percent. Commodities prices are trading at their lowest level in more than four years, with iron ore .IO62-CNI=SI and oil both near five-year lows. Raw materials such as soybeans, copper and iron ore make up the bulk of Latin American exports, and their prices tend to influence local currencies. That is especially true for countries with one main export, such as Chile, whose peso usually shifts with copper prices. The dollar also got a boost from comments from two Federal Reserve officials who said the U.S. economy would benefit from a decline in oil prices, which would not affect the central bank's plans to lift interest rates. Brazil's Bovespa stock index was nearly unchanged after four straight days of declines, while Mexico's IPC stock index dropped to its lowest level in nearly six weeks. Yields on Brazilian interest rate futures <0#DIJ:> rose across the curve as investors shifted their expectations toward a 50 basis point increase in the benchmark Selic interest rate on Wednesday. Economists in a recent Reuters poll had been split between rate hikes of 25 and 50 basis points, although traders are now expecting more hawkish action following the appointment of Brazil's new economic team last week. Key Latin American stock indexes and currencies at 1708 GMT: Stock indexes daily % YTD % Latest change change MSCI Emerging Markets 984.28 -0.08 -1.76 MSCI LatAm 2895.34 -0.68 -8.92 Brazil Bovespa 52280.1 0.01 1.50 Mexico IPC 43150.91 -0.56 0.99 Chile IPSA 3966.03 0.19 7.21 Chile IGPA 19353.97 0.18 6.18 Argentina MerVal 9504.439 1.47 76.30 Colombia IGBC 11952.09 0.44 -8.56 Peru IGRA 15164.01 -0.13 -3.74 Venezuela IBC 2989.53 0.04 9.24 Currencies daily % YTD % change change Latest Brazil real 2.5758 -0.69 -8.50 Mexico peso 14.092 -0.69 -7.54 Chile peso 614 -0.08 -14.32 Colombia peso 2302.5 -1.63 -16.09 Peru sol 2.942 -0.48 -5.06 Argentina peso 8.5350 -0.03 -23.93 (interbank) Argentina peso 13.02 -1.31 -23.20 (parallel) (Reporting by Asher Levine)
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