MEXICO CITY: Mexico's peso surged on Friday, gaining the most in six weeks as it tracked a rally in oil prices, while stocks in Brazil edged back from a steep selloff.
In currency markets, the peso climbed 1.5 percent to a nearly three-week high. That was its biggest one-day gain since May 10. The peso firmed for the third session in a row as it clawed back ground from a 1-1/2-year low it hit last week.
Oil prices rose sharply after the Organization of the Petroleum Exporting Countries agreed to only modest crude output increases at a time of rising global demand. Mexico is a major crude exporter.
Also supporting the currency, Mexico's central bank hiked its benchmark interest rate 25 basis points to a more than nine-year high of 7.75 percent on Thursday and the interest rate swaps market pointed to another hike in August.
Mexico's peso had been hit by a broad dollar rally, a deadlock in talks around the NAFTA free trade deal, and nervousness ahead of Mexico's July 1 presidential election. But it has suffered less than Brazil and Argentina's currencies.
Emerging markets worldwide have been hit hard in recent months by fears of a global trade war, among other factors, with Brazilian stocks among the big losers.
Brazil's Bovespa climbed 0.81 percent after shedding nearly 3 percent in the prior session.
Rental car company Localiza Rent a Car SA shares rose 2.8 percent after it announced on Thursday night plans to buy back up to 43 million shares.
Miner Vale rose 1.7 percent, tracking higher iron prices in China.
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