SAO PAULO: Latin American currencies were flat to weaker on Tuesday after strong US economic data raised doubts over whether the Federal Reserve would deploy stimulus measures that often boost dollar inflows to emerging countries.
The Brazilian real dropped 0.2 percent after data showed US retail sales rose in July for the first time in four months, a sign that consumers could drive faster economic growth in the third quarter.
"The data allowed for a more optimistic view of the US economic recovery, adding to the expectations of a stronger dollar," said Mauricio Nakahodo, an economic research consultant with Bank of Tokyo-Mitsubishi in Sao Paulo.
Mexico's peso was little changed from Monday's close, however, as the strong US economic data added to the prospects of the Mexican economy, which sends about 80 percent of its exports to the United States.
Also cushioning currency losses in Latin America was data showing the euro zone's economy contracted only 0.2 percent in the second quarter, not as bad as many investors feared.
"The lack of negative news has left markets reasonably stable," said Gauber Romano, a trader with Intercam brokerage in Sao Paulo.
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