* Latam FX index set for best month since January * Dollar weakens on lower safe-haven demand * China to sign Phase 1 trade deal U.S. this week - SCMP By Shreyashi Sanyal Dec 30 (Reuters) - Latin American currencies started the week on a firm footing on Monday, as improving sentiment around trade relations between the United States and China discouraged safe-haven buying of the dollar, exacerbating its fall. MSCI's index for Latin American currencies rose 0.3% and was on track to post its strongest monthly gain since January. "The dollar seems to be out of love as we approach the new year," Hussein Sayed, chief market strategist at FXTM wrote in a note. "As fears of a global recession have dissipated ... expect to see some rotation from the U.S. into emerging markets. If this scenario plays out, expect the dollar to remain under pressure for the next couple of weeks." With most market players gearing up for a holiday-shortened week, analysts do not expect significant moves until the start of the New Year. Adding to the upbeat sentiment was a report from the South China Morning Post that said Chinese Vice Premier Liu He will visit Washington this week to sign a Phase 1 trade deal with the United States. Brazil's real and the Colombian peso were the firmest among their Latin American peers. Brazil's public-sector finances improved further in November, central bank figures showed, as the deficit as a share of the overall economy shrank to its smallest in over a year and the national debt fell for the third straight month. Key Latin American stock indexes and currencies at 1414 GMT; Stock indexes Latest Daily % change MSCI Emerging Markets 1120.01 0.13 MSCI LatAm 2943.41 0.45 Brazil Bovespa 116906.90 0.32 Mexico IPC - - Chile IPSA 4661.42 -0.16 Argentina MerVal - - Colombia COLCAP - - Currencies Latest Daily % change Brazil real 4.0400 0.23 Mexico peso 18.8640 -0.17 Chile peso 748.8 -0.21 Colombia peso 3275.65 0.64 Peru sol - - Argentina peso - - (interbank) (Reporting by Shreyashi Sanyal in Bengaluru; editing by Nick Macfie)
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