SAO PAULO/MEXICO CITY: Mexico's peso edged up on Wednesday after encouraging US employment and service sector data improved the outlook for the Mexican economy.
But uncertainty related to Spain as well as a slowdown of the Chinese economy weighed on Latin American foreign exchange markets.
"Markets are wondering whether Spain will request a bailout or not. That raises investors' appetite for safe-haven assets such as the dollar," said Mauricio Nakahodo, an economic research consultant with Tokyo-Mitsubishi bank in Sao Paulo.
The Mexican peso gained 0.3 percent to 12.820 per dollar after data showed growth in the US services sector picked up in September, defying economists' expectations for a slight decrease, while the private sector added more jobs than forecast last month.
"If there is one place where there is growth, it is the United States and not the rest, which is a bit positive for Mexico in general and the peso," said Enrique Alvarez, an analyst at IDEAglobal in New York.
The United States is Mexico's main trading partner and a rebound in the US economy could translate into more dollar inflows into its southern neighbor.
The Brazilian real gained 0.2 percent to 2.0224 per dollar with traders citing some dollar inflows.
Expectations that the central bank would intervene in the market to stop the currency from gaining past the level of 2 per dollar -- considered beneficial to exporters -- have greatly reduced the currency's volatility in the past few months.
Chile's peso edged 0.1 percent lower to 473.40 per greenback after purchasing managers indexes suggested China's economic slowdown was likely to extend to a seventh quarter. China is the main destination of Chile's copper exports.
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