BRASILIA: The Brazilian real and the Mexican peso inched up on Friday after mixed US economic figures drove investors to pare back bets on a fast pace of US interest rate hikes in coming months.
The US economy slowed in the first quarter as growth in consumer spending braked sharply, though labor costs increased more than expected in the period.
“Consumer spending was weak, despite a strong overall reading. We’ll need more clues to justify the recent growth of rate hike bets,” said Mauriciano Cavalcante, the head of currency trading at Ourominas.
Emerging market currencies have slumped in recent weeks due to expectations of accelerating inflation and a widening fiscal deficit that could drive the US Federal Reserve to accelerate policy tightening. That would likely dampen demand for high-yielding assets.
The Mexican peso firmed 0.4 percent, while the Brazilian real edged up 0.2 percent.
The benchmark Bovespa stock index was up 0.3 percent following a heavy batch of corporate updates.
Shares of GPA SA jumped 4.3 percent after the food retailer beat first-quarter profit estimates on Thursday after a strong performance by its wholesale unit.
Planemaker Embraer SA, however, fell 2 percent after it reported a first-quarter loss.
Source: Brecorder
