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Mexico Peso Leads Emerging Market Rally on Dovish Bank of Japan
Mexico’s peso led a relief rally in emerging markets after the Bank of Japan signaled it would be cautious about raising interest rates, easing pressure on currencies that had been hammered as investors abandoned yen-funded bets on riskier assets. The news from Japan also boosted emerging market stocks, with MSCI’s EM equity index up 2% as it rose for a second day in a row and headed for its best two-day rally since November. The Mexican peso, one of the currencies hit hardest by the Japanese yen’s rally and an unwinding of so-called carry trade strategies, surged as much as 2.2%, recouping most of its losses ... (full story)