EMERGING MARKETS-Latin American currencies dip on profit-taking

Mon Nov 25, 2013 1:51pm EST

RIO DE JANEIRO, Nov 25 (Reuters) - Latin American currencies
weakened slightly on Monday as investors pocketed recent gains
in a market that remains cautious about the timing of an
expected withdrawal of U.S. economic stimulus.
    A deal to curb Iran's nuclear program encouraged investors
on Wall Street but failed to boost appetite for emerging market
currencies and stocks, whose performance remains closely tied to
the outlook for U.S. monetary policy.
    Expectations that U.S. interest rates would remain near zero
for years, even after the Federal Reserve starts winding down
its bond-buying program, fueled a rally in Latin American
currencies on Friday.
    * Brazil's real  was 0.1 percent weaker after
rallying 1 percent on Friday. The currency briefly strengthened
past its 100-day moving average last week but failed to hold
onto gains.
    * Losses in the real were curbed by regular central bank
auctions of currency swaps, derivatives that mimic a sale of
dollars in the futures market. On Monday the bank sold 10,000
swaps through its daily intervention program and another 20,000
swaps to roll over similar contracts that expire on Dec. 2.
    * Mexico's peso  lost 0.4 percent to 13.0275
per dollar, erasing all of the gains recorded in the previous
session and crossing past the psychologically relevant mark of
13 per dollar.
    * The Chilean peso lost 0.3 percent even as central
bank chief Rodrigo Vergara sounded more hawkish by saying that
the country's key interest rate is now at a neutral level and
that the bank has not launched a "permanent" reduction cycle.
     

 Latin American currencies at 1820 GMT:
    
 Currencies                             Daily  YTD pct
                                          pct   change
                              Latest   change  
 Brazil real                  2.2835    -0.09   -10.66
                                               
 Mexico peso                 13.0275    -0.42    -1.25
                                               
 Chile peso                 520.9000    -0.27    -8.10
                                               
 Colombia peso            1,924.8000     0.20    -8.25
                                               
 Peru sol                     2.8030    -0.04    -8.99
                                               
 Argentina peso               6.0800    -0.33   -19.20

 Argentina peso               9.8900     0.51   -31.45
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