EMERGING MARKETS – The South African rand, the real Brazilian firm after the move of the cenbank

    * S.African cenbank holds rates, raises GDP forecast
    * Brazil cenbank hikes by 100 bps
    * Brazil cenbank tone less hawkish than expected -analyst
    * Rising inflation in Mexico spurs rate hike bets 
    * Turkish lira drops after 100 bps rate cut 

    By Susan Mathew
    Sept 23 (Reuters) - Central bank moves headlined emerging
market currency action on Thursday, with South Africa's rand
taking in stride a decision to hold rates, while Brazil's real
firmed after an expected 100 basis points hike overnight.
    Turkey's lira stayed well in the red after a surprise
rate cut despite surging inflation.
    The South African Reserve Bank left the key interest rate
unchanged at a record low of 3.5% as expected, but raised its
economic growth forecast for 2021 to 5.3% from 4.2% and said the
risks to the short-term inflation outlook were assessed to the
    The rand hit 14.6881 against the dollar just after
the decision, but was soon back at 14.61, up 1.2%. It was at
14.63 prior to the decision. 
    Meanwhile, in an aggressive battle against inflation,
Brazil's central bank raised the benchmark Selic rate by 100
basis points overnight to 6.25% and flagged another one of the
same measure next month. But it failed to boost the real
significantly as it was seen as less hawkish than expected.

    "We think that the bull case for BRL has been undermined by
the weaker China growth outlook, which already has led to a
severe deterioration of the terms of trade for Brazil, which may
continue," said strategists at Citi.
    "On top of this, the central bank is turning more dovish on
the margin. An aggressive central bank was one of the core
reasons to stick to the BRL long."
    But the currency, along with Mexico's peso
outperformed muted moves by most other Latam peers as sliding
commodity prices limited the upside from a weakening
    Mexico's peso firmed 0.4% after data showing a bigger
than expected rise in annual inflation in the first half of
September spurred rate hike bets. By mid-month, consumer prices
accelerated 0.42% to reach annual inflation of 5.87%, already
edging above the 5.59% clocked for August.
    Meanwhile, Argentina made a near $1.9 billion payment to the
International Monetary Fund on Wednesday as it attempts to
revamp the over $40 billion it still owes. The payment was made
with funds Argentina received from the IMF's Special Drawing
Rights program.
    Latam stocks joined a broader rally in EM well as global
equity markets as reassurances from indebted Chinese developer
Evergrande about its repayments assuaged some fears of
contagion in a likely default event. 
    Key Latin American stock indexes and currencies at 1408 GMT:
 Stock                           Latest     Daily % change
 MSCI Emerging Markets           1272.25    0.75
 MSCI LatAm                      2328.42    -0.25
 Brazil Bovespa                  113451.82  1.04
 Mexico IPC                      51357.07   0.04
 Chile IPSA                      4395.85    0.27
 Argentina MerVal                -          -
 Colombia COLCAP                 1315.76    0.42
 Currencies                      Latest     Daily % change
 Brazil real                     5.2778     0.47
 Mexico peso                     20.0070    0.38
 Chile peso                      788.1      -0.19
 Colombia peso                   3828.53    0.05
 Peru sol                        4.1111     -0.28
 Argentina peso (interbank)      98.5100    -0.02
 (Reporting by Susan Mathew in Bengaluru; Editing by Andrea

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