Latam currencies firm after US jobs data; weekend elections eyed

Latin American currencies firmed on Friday as the dollar weakened after US payrolls data disappointed, with Mexico's peso set for its biggest one-day gain in three weeks and Brazil's real near six-month highs.

US nonfarm payrolls data came in below expectations, easing worries that the pace of economic rebound could fan inflation and prompt a change in the stance of US monetary policy.

"The data has helped calm fears that... the Fed could start to taper support sooner," said Fiona Cincotta, senior financial markets analyst at City Index.

This hit the dollar, while US stocks rallied, providing cues for stocks in Latam.

The weekend will be eventful and keenly watched in Peru and Mexico, with the former choosing its president, while mid-term elections in the latter have the capacity to determine the course of economic reforms in the country.

The Mexican peso rose 1%. Fluctuations in oil prices and the worries around the election pushed it around 0.4% lower for the week.

Peru's sol stayed in record low territory. Recent polls suggest that the presidential race will be tightly fought between right-wing conservative Kieko Fujimori and socialist rival Pedro Castillo, whose visions for the country stand in stark contract to each other.

"We would not be surprised if results take longer to be declared final by the electoral authority," strategists at Credit Suisse said, which could mean a prolonged period of market uncertainty.

Whoever wins, the Andean country is set for a volatile and uncertain road ahead, analysts say.

Colombia's peso tracked rising oil prices almost 1.4% higher. On the week, the currency is up about 2.3% - its best week since the beginning of the year.

Colombia's government is struggling to push a watered-down tax reform through a reticent congress. Uncertainty over the proposal has already led S&P Global Ratings to lower its rating for the country, sparking fears Fitch and Moody's will follow suit.

Brazil's real gained half a percent as it returned from a day's holiday, rising for a seventh straight session . The currency is up more than 3% this week, thanks to upbeat economic growth numbers.

Iron ore miner Vale fell 0.5% as prices for steel making ingredients fell. Vale on Friday said it interrupted production at its Timbopeba mine and part of its Alegria mine after prosecutors ordered the evacuation of an area around the nearby Xingu dam.