EMERGING MARKETS-Brazil real, Mexico peso jump after BOJ cuts rates below zero
By Bruno Federowski SAO PAULO, Jan 29 (Reuters) - The Brazilian real and the Mexican peso jumped on Friday after the Bank of Japan unexpectedly cut a benchmark rate below zero, fostering demand for high-yielding assets. The move stunned investors who believed Japanese policymakers were too cautious to follow the European Central Bank, which ventured to negative territory in 2014. Data showing a sharp decrease in U.S. economic growth in the fourth quarter also helped sentiment, boosting bets on a slower pace for U.S. interest rate hikes. "It seems the global environment will continue to be one of near-zero interest rates," said Luis Felipe Laudísio, a fixed-income trader at Renascença brokerage in São Paulo. The Brazilian real advanced 1.8 percent towards 4 reais per U.S. dollar. The Mexican peso rose 0.9 percent, also helped by data showing the country's economy picked up in 2015. Mexico's currency commission on Thursday extended a daily dollar auction program, disappointing some who expected an increase in intervention. The Chilean peso was nearly unchanged after the minutes of a central bank policy meeting showed policymakers saw inflation returning to its target range during the second half of 2016. Traders said the document confirmed expectations that any future policy tightening should be gradual. Latin American stock indexes and currencies at 1450 GMT: Stock indexes daily % YTD % change change Latest MSCI Emerging Markets 738.51 2.25 -9.06 MSCI LatAm 1714.75 2.9 -8.93 Brazil Bovespa 39633.54 2.6 -8.57 Mexico IPC 42853.09 1.09 -0.29 Chile IPSA 3624.43 0.87 -1.52 Chile IGPA 17889.95 0.76 -1.44 Argentina MerVal 11078.43 1.79 -5.11 Colombia IGBC 8579.32 0.69 0.37 Venezuela IBC 14043.49 0.08 -3.73 Currencies daily % YTD % change change Latest Brazil real 4.0073 1.75 -1.50 Mexico peso 18.1600 0.88 -5.12 Chile peso 709.8 0.00 -0.01 Colombia peso 3267.4 0.33 -3.00 Peru sol 3.4681 -0.09 -1.56 Argentina peso (interbank) 13.8900 -0.22 -6.53 Argentina peso (parallel) 14.21 0.56 0.42 (Reporting by Bruno Federowski; Editing by Lisa Von Ahn)
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