Brazil, Mexico Currencies Both Rebound but Real has More Legs Than Peso

The Brazilian Real and Mexican Peso have both rebounded strongly in recent weeks, but their rallies are starting to diverge with the Peso running out of steam and the Real gaining momentum.

RIO DE JANEIRO, BRAZIL - (Reuters) The two heavyweight Latin American currencies were pressured this year as their countries’ central banks slashed interest rates, historically deep recessions loomed on the horizon and investors dumped emerging market assets due to the coronavirus crisis.

Now, both currencies have surfed the wave of improving global market sentiment and appetite for risky assets, with trillions of dollars of monetary and fiscal stimulus lifting hopes for a quick post-pandemic economic recovery.

The Peso’s selloff faded earlier, and it has appreciated 15 percent against the US$ mid-April. Brazil’s real hit a record low . . .

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