February 1, 2017 / 2:25 PM / a year ago

EMERGING MARKETS-LatAm currencies pare back gains on strong U.S. jobs data

By Bruno Federowski
    SAO PAULO, Feb 1 (Reuters) - Latin American currencies pared
back gains on Wednesday after strong U.S. jobs data fueled
expectations that the U.S. Federal Reserve would strike a
hawkish tone later in the day.
    U.S. private employers added 246,000 jobs in January, above
the 165,000 median forecast in a Reuters poll, according to the
ADP National Employment Report. 
    Traders have closely followed U.S. economic figures in
search of clues over the pace of rate hikes throughout the
coming months.
    Analysts expect the Fed to keep rates unchanged when it
announces its decision on Wednesday, though U.S. President
Donald Trump's pledges of fiscal spending have fostered bets on
a faster-than-expected tightening cycle.
    The Brazilian real inched up 0.1 percent after
strengthening as much as 0.5 percent in morning trading, while
the Chilean peso was nearly flat.
    Traders had earlier purchased emerging market assets after a
report showed China's manufacturing sector expanded for the
sixth month in a row in January. 
    Brazil's benchmark Bovespa stock index rose over 1
percent, boosted by rising shares of miner Vale SA.
Traders cited expectations of strong fourth-quarter results, due
on Feb. 23.
    Shares of state-controlled oil company Petróleo Brasileiro
SA also rose, tracking an increase in crude futures
on signs that Russia and OPEC producers will deliver on promises
of output cuts.
    Key Latin American stock indexes and currencies at 1415 GMT:
 Stock indexes                            daily %    YTD %
                                 Latest    change   change
 MSCI Emerging Markets            914.60     0.59     5.45
 MSCI LatAm                      2534.73     0.73     7.51
 Brazil Bovespa                 65487.65     1.26     8.73
 Chile IPSA                      4231.20     0.75     1.92
 Chile IGPA                     21127.29     0.66     1.90
 Currencies                               daily %    YTD %
                                           change   change
 Brazil real                      3.1517    -0.08     3.09
 Mexico peso                     20.7375     0.43     0.03
 Chile peso                        646.7     0.03     3.71
 Colombia peso                    2904.1     0.50     3.35
 Peru sol                          3.265     0.18     4.56
 Argentina peso (interbank)      15.8700     0.19     0.03
 Argentina peso (parallel)         16.59     0.66     1.39

 (Reporting by Bruno Federowski; Editing by Nick Zieminski)
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