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EMERGING MARKETS-Mexican peso firms with focus on central bank bill debate

    * Mexico's lower house debates disputed central bank bill
    * U.S. stimulus hopes weaken U.S. dollar 
    * Brazil's V-shaped recovery to lose steam -central bank

    By Shashank Nayar
    Dec 15 (Reuters) - Mexico's peso stabilized on Tuesday after
a four-day slide as investors eyed a debate over a hotly
contested central bank bill, while other Latin American
currencies gained footing on optimism around COVID-19 vaccines
and higher oil prices. 
    The Mexican peso gained 0.2% to trade at 20.1978 per
dollar.
    The lower house of Mexico's Congress on Tuesday will debate
the bill that critics say would force Mexico's central bank to
accept money from drug gangs, lawmakers said, and the measure
could go to a vote on the same day.
    Ratings agency Moody's warned late on Monday that the reform
would be "credit negative" for the sovereign because it would
compromise the bank's autonomy. 
    "If they push it through the House today, USDMXN could make
a quick move up to 20.50 as markets fret for a few days over the
implications," FX strategists at BMO Capital Markets said in a
note. "We don't think USDMXN will stay above 20.00 for long, so
we would be sellers on a spike."
    The oil exporter's currency hit a March high versus the
dollar last week, aided by stronger crude prices, hopes of
better trade ties under U.S. President-elect Joe Biden and
mostly on hopes of a steady global recovery next year.
    The Brazilian real and the Colombian and the
Chilean pesos firmed against the dollar, weakened by
hopes of more U.S. coronavirus relief aid.  
    Minutes of Brazil's latest central bank meeting showed
policymakers see inflation staying high in December due to
temporary shocks. Central bank President Roberto Campos Neto
said the country's economic recovery, which he described as
V-shaped, has started to lose steam.
    The real had rallied last week after policymakers said they
could "soon" drop a pledge to keep rates lower for longer amid a
spike in inflation. 
    The currency of the world's largest copper producer, Chile, 
 gained 0.1% as copper prices firmed, supported by strong
factory data from China, the world's top metal
consumer.
    
    Key Latin American stock indexes and currencies:
    
                                       Latest       Daily %
                                                     change
 MSCI Emerging Markets                    1248.40       -0.16
 MSCI LatAm                               2403.69        0.73
 Brazil Bovespa                         115361.98        0.66
 Mexico IPC                                  0.00           0
 Chile IPSA                               4052.06       -0.02
 Argentina MerVal                        53294.52       0.491
 Colombia COLCAP                          1389.31           0 Currencies                  Latest       Daily %
                                                     change
 Brazil real                               5.0978        0.56
 Mexico peso                              20.1978        0.21
 Chile peso                                 734.7        0.05
 Colombia peso                            3420.19        0.16
 Peru sol                                  3.5917       -0.11
 Argentina peso (interbank)               82.5300       -0.08
                                                   
 

 (Reporting by Shashank Nayar in Bengaluru; editing by Jonathan
Oatis)
  
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