May 13, 2015 / 3:50 PM / 3 years ago

EMERGING MARKETS-Latin American currencies gain on weak U.S. data

SAO PAULO, May 13 (Reuters) - Latin American currencies
strengthened on Wednesday following disappointing U.S. economic
data, though Brazil's real stayed anchored near the key
3-per-dollar level.
    Equities markets were mixed, with MSCI Latin American stock
index edging slightly higher, though Brazil's
Bovespa index dropped for a second straight day.  
    Data on Wednesday showed U.S. retail sales were flat in
April, indicating the economy was struggling to rebound strongly
after barely growing in the first quarter. 
    Disappointing economic data from the U.S. tends to raise
investor expectations that interest rates in the world's largest
economy will rise later rather than sooner, boosting the appeal
of higher-yielding, albeit riskier, emerging market assets. 
    Nearly every Latin American currency gained against the
dollar, with the Chilean and Mexican pesos  both up
about 0.5 percent. 
    Brazil's real strengthened about 1 percent against the
dollar in early trading, though returned to nearly unchanged
territory by early afternoon.
    Many traders believe the real is unlikely to sustain a level
stronger than 3 to the dollar for the time being due to reduced
currency intervention from Brazil's central bank. 
    "Many people are trading as if this level were the floor,"
said a trader at a major bank who is not authorized to speak
with the press. 
    In local stocks, Brazil's Bovespa stock index 
dropped its most in a week, mostly on a decline in bank shares
and iron-ore manufacturer Vale SA. 
    Vale shares tend to track the outlook for economic growth in
China, its main customer, which reported its lowest pace of
investment growth in 15 years on Wednesday.
    Mexico's IPC stock index remained rangebound near the
45,000 point level, where it has remained since the beginning of
the month. 
    Key Latin American stock indexes and currencies at 1545 GMT:
 Stock indexes                                daily %    YTD %
                                               change   change
 MSCI Emerging Markets               1035.51     0.63      7.6
 MSCI LatAm                           2707.7     0.19    -0.92
 Brazil Bovespa                     56445.95    -0.61    12.88
 Mexico IPC                         45014.96     0.14     4.33
 Chile IPSA                          4104.32    -0.34     6.58
 Chile IGPA                         19895.37    -0.27     5.43
 Argentina MerVal                   12331.92     0.77    43.75
 Colombia IGBC                      10622.77      0.3    -8.70
 Venezuela IBC                       5633.82        0    46.00
 Currencies                                   daily %    YTD %
                                               change   change
 Brazil real                          3.0187     0.00   -11.97
 Mexico peso                         15.2333     0.71    -3.21
 Chile peso                            600.4     0.47     1.00
 Colombia peso                       2379.15     0.14     0.37
 Peru sol                              3.152    -0.06    -5.49
 Argentina peso (interbank)           8.9325     0.06    -4.28
 Argentina peso (parallel)             12.53     0.00    11.73

 (Reporting by Asher Levine Editing by W Simon)
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