Mon Jun 2, 2014 12:39pm EDT

SAO PAULO, June 2 (Reuters) – Brazil’s real weakened the
most in a month on Monday on uncertainty over the future of the
central bank’s currency intervention program and a worsening
outlook for domestic economic growth.
Other currencies in the region also weakened slightly,
though encouraging economic data from China boosted local
The Brazilian real fell to 2.269 per dollar after
having spent nearly two months in the 2.20 to 2.25 range, which
many traders had seen as an informal trading band enforced by
the central bank through daily currency
After market close on Friday the central bank signaled it
would roll over fewer expiring swaps in June than it did in May.
Traders have become less certain over the future of the
program, which offers currency swaps to investors who wish to
hedge themselves against a possible weakening of the real and is
slated to last at least until the end of the month.
“Given that inflation has started to recede while growth
remains tepid, it has become less imperative for the real to
remain strong,” wrote Citi analyst Kenneth Lam in a client note.
The real was further hit by a central bank poll of
economists on Monday showing expectations for economic growth at
1.5 percent for 2014, down from 1.63 percent last week.
Latin American stocks mostly gained after Purchasing
Managers’ Index data from China showed signs of an economic
revival in Brazil’s top trading partner; a key market for local
commodities exports such as iron-ore, soybeans and copper.
Brazil’s Bovespa stock index rebounded off its
lowest level in a month, driven by shares of iron-ore mining
giant Vale SA, which counts China as its biggest
Mexico’s IPC index rose its most in three weeks,
boosted by a slight improvement in manufacturing data and
bargain-hunting after a sharp drop on Friday.
Shares of telecommunications firm America Movil
rose about 1 percent. The company on Monday that it will offer
up to 25 billion pesos ($1.94 billion) in two separate offerings
of five and ten-year senior notes.

Key Latin American stock indexes and currencies at 1603 GMT:

Stock indexes                             daily %     YTD %
Latest       change    change
MSCI Emerging Markets           1028.48      0.08      2.49

MSCI LatAm                      3241.01     -0.04       1.3

Brazil Bovespa                  51617.6      0.74      0.21

Mexico IPC                     41789.39      1.03     -2.19

Chile IPSA                      3903.88         0      5.53

Chile IGPA                     19091.96     -0.06      4.75

Argentina MerVal                7641.48     -0.91     41.74

Colombia IGBC                  13663.57         0      4.53

Peru IGRA                      15800.31       0.3      0.30

Venezuela IBC                   2156.98     -0.01    -21.18

Currencies                                daily %     YTD %
change    change
Brazil real                      2.2685     -1.27      3.89

Mexico peso                     12.9105     -0.39      0.93

Chile peso                        550.3     -0.13     -4.40

Colombia peso                   1901.15     -0.27      1.62
Peru sol                          2.773     -0.40      0.72

Argentina peso (interbank)       8.0800      0.00    -19.65

Argentina peso (parallel)         11.41      0.35    -12.36