EMERGING MARKETS-Latam currencies gain after Fed-induced losses

Fri Jun 21, 2013 5:14pm EDT

RIO DE JANEIRO, June 21 (Reuters) - Latin American
currencies strengthened on Friday, after at least two days of
heavy losses that followed signals the U.S. Federal Reserve is
preparing to shut down its stimulus program.
    The Fed's bond-buying program has provided a steady source
of dollars seeking higher returns in emerging market economies
and investors fear its end could dramatically reduce the appeal
of risk assets.
    Friday's gains were seen as a temporary rebound from recent
losses, however, as more declines are expected when it becomes
clearer when exactly the Fed will start to taper its stimulus.
    * Brazil's real  gained 0.6 percent to 2.2438
per dollar, a day after five consecutive sessions of losses took
the currency to its weakest level in more than four years.
    * Contributing to the rebound of the real was a central bank
auction of so-called traditional currency swaps, derivative
contracts that mimic the sale of dollars in the futures market.
 
    * Mexico's peso firmed 0.3 percent, also halting a
string of five losing sessions, as central bankers said they
were prepared for further shocks to the peso resulting from the
unwinding of U.S. stimulus. 
    * Chile's peso closed nearly half a percentage
point stronger, also supported by gains in the price of copper,
the country's main export product.   

    Latin American FX prices at 2105 GMT: 
    
 Currencies                         daily %    YTD %
                                     change   change
                            Latest           
 Brazil real                2.2438     0.58    -9.08
                                             
 Mexico peso               13.3200     0.30    -3.42
                                             
 Chile peso               511.5000     0.47    -6.41
                                             
 Colombia peso           1937.9000     0.09    -8.87
                                             
 Peru sol                   2.7800     0.36    -8.24
                                             
 Argentina peso             5.3475    -0.09    -8.13

 Argentina peso             8.5200     0.35   -20.42
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