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EMERGING MARKETS-Brazil's real jumps to two-month high; Fed in focus

    * Brazil's consumer confidence jumps in April
    * Mexico's economy likely slowed during the first quarter -
poll

    By Shashank Nayar
    April 28 (Reuters) - Most Latin American currencies gained
on Wednesday, with Brazil's real jumping to a two-month high on
improving economic prospects, while investors awaited an
interest rate decision from the Federal Reserve.
    MSCI's index of Latin American currencies
and stocks gained 0.3% each, as markets bet the
Federal Reserve would not hike rates and continue to support the
economy following a run of positive economic data.
    The real rose 1.22% to its highest point since late-
February after consumer confidence marked its biggest rise in
nine months in April, as households looked through the second
wave of the pandemic to a brighter economic landscape in the
coming months.
    "The imminent passing of the budget for 2021, officially
respecting the spending cap and the affirmation efforts that the
tax and administrative reforms would be stepped up, supported
BRL-positive sentiment," said Melanie Fischinger, an emerging
markets analyst at Commerzbank.
    However, flailing public finances and a damaging second wave
of COVID-19 infections weighed on the real's outlook.
    "Until investors are convinced that a consolidation of the
national finances and the implementation of the planned reforms
will take priority, BRL will continue to struggle with
appreciation," added Fischinger.
    Currencies of oil exporting countries, Mexico and Colombia
 gained 0.3% and 0.4% respectively, tracking higher
oil prices amid expectations of rising fuel demand.
    Gains were limited in the Mexican peso as a Reuters poll
showed the Mexican economy likely grew only marginally during
the first quarter of the year due to the impact of the
coronavirus pandemic and energy shortages in
February.
    Economic activity took a hit in February when a spell of
unusually cold weather in the United States, especially Texas,
led to gas shortages in Mexico that forced temporary shutdowns
of Mexican factories.
    Chile's peso was subdued as copper prices eased from
10-year highs, but analysts at Goldman Sachs joined others
predicting a copper rally to record levels.       
    Chilean President Sebastian Pinera on Tuesday abandoned his
challenge to an opposition-led bill allowing citizens to draw
down a third tranche of their pensions, saying he would sign it
into law, further supporting the currency.
    So far, Chileans have withdrawn two 10% tranches of their
pensions, totaling $37.5 billion in savings.
    Meanwhile, U.S. President Joe Biden is set to address the
Congress later in the day, and is likely to underscore his
administration's plans for mass infrastructure and stimulus
spending.
        
    Key Latin American stock indexes and currencies:
    
                              Latest      Daily % change
 MSCI Emerging Markets         1366.18                0.31
                                        
 MSCI LatAm                    2436.65                0.97
                                        
 Brazil Bovespa              120319.96                0.78
                                        
 Mexico IPC                   48711.36               -0.21
                                        
 Chile IPSA                    4757.17                0.17
                                        
 Argentina MerVal             49929.36               1.975
                                        
 Colombia COLCAP               1299.26                0.47 Currencies             Latest      Daily % change
 Brazil real                    5.3949                1.22
                                        
 Mexico peso                   19.9760                0.32
                                        
 Chile peso                      701.7               -0.04
                                        
 Colombia peso                 3699.72                0.44
 Peru sol                       3.8197                0.50
                                        
 Argentina peso                93.4100               -0.07
 (interbank)                            
                                        
 

 (Reporting by Shashank Nayar in Bengaluru; editing by Philippa
Fletcher)
  
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