EMERGING MARKETS-Brazil, Mexico currencies firm as Fed hikes U.S. rates

SAO PAULO/MEXICO CITY, Sept 26 (Reuters) – Brazil and Mexico’s currencies firmed on Wednesday after the U.S. Federal Reserve raised interest rates and left intact plans to steadily tighten monetary policy, while strong polling by a market-friendly Brazilian presidential candidate helped lift the real.

Brazil’s real currency strengthened almost 1.3 percent after the poll by Brazil’s Instituto Parana showed right-wing Jair Bolsonaro in the lead, with 31.2 percent of respondents planning to vote for him in the first round of the presidential election on Oct. 7. That compares with 20.2 percent support for Fernando Haddad, the leftist protege of jailed former President Luiz Inacio Lula da Silva.

Crucially, the poll showed Bolsonaro winning a likely second round later in October, with 44.3 percent of the vote versus Haddad’s 39.4 percent. Prior polls had shown Bolsonaro giving up ground to his main leftist opponent.

The poll came as welcome news to traders, who generally favor Bolsonaro for his avowed free-market policies, after a separate recent poll had shown Bolsonaro losing in a likely run-off.

"The market liked the poll because it showed Bolsonaro rising, not stagnating," said Jose Carlos Amado, a trader at brokerage Spinelli.

The real climbed 1.27 percent against the dollar.

Brazilian equities were effectively flat for much of Wednesday, dragged down by heavily weighted iron ore miner Vale SA and a slew of corruption arrests in the infrastructure sector.The peso strengthened 0.83 percent on the back of the Fed’s decision and as it forecast that the U.S. economy would enjoy at least three […]

PVR Property Management
EMERGING MARKETS-Brazil, Mexico currencies firm as Fed hikes U.S. rates

EMERGING MARKETS-Brazil, Mexico currencies firm as Fed hikes U.S. rates

SAO PAULO/MEXICO CITY, Sept 26 (Reuters) – Brazil and Mexico’s currencies firmed on Wednesday after the U.S. Federal Reserve raised interest rates and left intact plans to steadily tighten monetary policy, while strong polling by a market-friendly Brazilian presidential candidate helped lift the real. Brazil’s real currency strengthened almost 1.3 percent after the poll by Brazil’s Instituto Parana showed right-wing Jair Bolsonaro in the lead, with 31.2 percent of respondents planning to vote for him in the first round of the presidential election on Oct. 7. That compares with 20.2 percent support for Fernando Haddad, the leftist protege of jailed former President Luiz Inacio Lula da Silva. Crucially, the poll showed Bolsonaro winning a likely second round later in October, with 44.3 percent of the vote versus Haddad’s 39.4 percent. Prior polls had shown Bolsonaro giving up ground to his main leftist opponent. The poll came as welcome news to traders, who generally favor Bolsonaro for his avowed free-market policies, after a separate recent poll had shown Bolsonaro losing in a likely run-off. "The market liked the poll because it showed Bolsonaro rising, not stagnating," said Jose Carlos Amado, a trader at brokerage Spinelli. The real climbed 1.27 percent against the dollar. Brazilian equities were effectively flat for much of Wednesday, dragged down by heavily weighted iron ore miner Vale SA and a slew of corruption arrests in the infrastructure sector. The peso strengthened 0.83 percent on the back of the Fed’s decision and as it forecast that the […]

PVR Property Management