(Adds afternoon prices)
By Bruno Federowski
SAO PAULO, Sept 22 Latin American stocks and
most currencies rallied for a second day on Thursday as traders
doubled down on bets that the U.S. Federal Reserve will raise
interest rates slowly.
Fed policymakers did not raise rates on Wednesday and
reduced their forecasts of annual rate increases in their policy
The policy statement caught some traders by surprise after
conflicting remarks by Fed officials had revived bets on an
aggressive hiking cycle.
"This could trigger strong inflows into emerging markets,"
said Tarcísio Rodrigues, head of currency trading with Brazil's
The Mexican stock index closed up 2.23 percent, its
biggest daily gain since late January.
The Brazilian real weakened 0.47 percent to 3.2248 reais per
dollar, but the Mexican peso strengthened 0.64 percent
to 19.6140 pesos per dollar at market close.
But many analysts believe the peso is poised to lose
further, weighed down by uncertainty over the outcome of the
U.S. presidential election in November.
Both the Chilean peso and the Peruvian sol strengthened to
their best levels in over a month.
Key Latin American stock indexes at 2224 GMT:
Stock indexes Latest Daily YTD pct
MSCI Emerging Markets 920.92 1.69 15.96
MSCI LatAm 2,428.73 2.58 32.73
Brazil Bovespa 58,994.17 1.03 36.09
Mexico IPC 47,975.05 2.23 11.63
Chile IPSA 4,100.17 0.62 11.41
Chile IGPA 20,391.70 0.56 12.34
Argentina MerVal 16,643.05 2.15 42.55
Colombia IGBC 9,995.14 1.17 16.94
Venezuela IBC 12,505.16 3.82 -14.28
(Reporting by Bruno Federowski; Additional reporting by Miguel
Angel Gutierrez in Mexico City, Froilan Romero in Santiago and
Ursula Scollo in Lima; Editing by Dan Grebler and Leslie Adler)