EMERGING MARKETS-Brazil’s real, Mexican peso lead Latam FX higher on strong commodity gains

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    * Metals rise after China Evergrande makes bond payment
    * Mexican central bank seen raising rates by 25 bps to 5%
    * Peru's central bank expected to raise rates by 50 bps
    * Chile's economy set to grow more than 11% this year -
Piñera

    Nov 11 (Businesshala) - Brazil's real led gains among Latin
American currencies on Thursday as basic material and metal
prices rose on China Evergrande cheer, while Mexico's peso
gained ahead of a central bank interest rate decision later in
the day.
    Mexico's peso rose 0.7% with the Mexican central
bank, locally known as Banxico, set to raise interest rates for
the fourth consecutive time at its monetary policy meeting. 
    Estimates are for a 25 basis points hike to 5%, in its
decision due at 2 pm ET (1900 GMT).
    Data earlier this week showed Mexican inflation surged in
October reaching a rate more than double the central bank's
target, cementing the need for more rate hikes.
    "If the bank were to increase the policy rate by 50bps
instead of 25bps, we think that financial markets would likely
see it as a definite acceleration in the tightening pace," wrote
analysts at Credit Suisse in a note.
    "Through this route, the bank would run the risk of ending
up with an unnecessarily high terminal rate, when considering
that this year's inflation shock is unlikely to persist into
2022."
    Peru's central bank is also seen hiking by 50 basis points
later on Thursday to 2%. The sol was steady ahead of the
meeting. 
    Brazil's real surged 1.3%, taking support from a rise
in iron ore and copper prices after Chinese property developer
Evergrande made its bond payments, raising hopes of government
support for a property sector that can drive significant demand
for metals.          
    Analysts at Bradesco also pointed to a certain level of
uncertainty reduction after Brazil's lower house approved a
constitutional amendment allowing for more spending. But Senate
passage is now awaited.  
    Sao-Paulo listed shares surged 2%, with the index
set for its best session in over two weeks. 
    Brazilian airline Azul SA, rose 4.3%
despite a wider net loss for the third-quarter thanks to higher
expenses on loans and leases.
    Emerging market currencies had taken a hit in the previous
session after a surge in U.S. inflation raised rate hike bets
there, sending the dollar to 16-month highs and bond yields
rising.
    South Africa's rand rallied 1%, nearing seven-week
highs, attempting to make back Wednesday's 2.7% drop post U.S.
inflation data. In its medium-term budget policy statement here,
 South Africa cut its deficit forecast, and now sees debt
peaking at a lower level. 
    Rising copper prices helped top producer Chile's peso
gain 0.5%.
    Chile's economy is set to grow more than 11% this year amid
a rapid recovery from the impact of the coronavirus pandemic,
President Sebastián Piñera said on Thursday. The forecast, 
higher than the previous government estimate, also helped
support the currency.
    Currency of the oil exporting nation Colombia lagged
as oil prices dropped to $82 a barrel, extending sharp falls
triggered by concerns over rising U.S. inflation while OPEC cut
its 2021 oil demand forecast.

    Key Latin American stock indexes and currencies at 1433 GMT:
    Stock indexes             Latest    Daily %
                                         change
 MSCI Emerging Markets         1280.18      0.45
                                        
 MSCI LatAm                    2217.70      1.75
                                        
 Brazil Bovespa              108073.87      1.99
                                        
 Mexico IPC                          -         -
                                        
 Chile IPSA                    4468.39     -0.46
                                        
 Argentina MerVal             96081.83         1
                                        
 Colombia COLCAP               1378.58      0.95
                                        
                                                
       Currencies             Latest    Daily %
                                         change
 Brazil real                    5.4268      1.38
                                        
 Mexico peso                   20.4921      0.63
                                        
 Chile peso                        790      0.58
                                        
 Colombia peso                 3876.53     -0.04
 Peru sol                       4.0193     -0.11
                                        
 Argentina peso               100.1600     -0.01
 (interbank)                            
                                        
 
 (Reporting by Shashank Nayar and Susan Mathew in Bengaluru;
Editing by Andrea Ricci)
  
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