Mexico Peso Surges After Dovish Bank of Japan Reignites Risk-On
- EM equity index posts biggest two-day gain since November
- El Salvador bonds rally after IMF says deal is getting close
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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 pressures from a selloff in yen-funded bets on riskier assets.
The currency surged 1.6%, recouping some of the losses sparked by the global market rout on Monday. Indonesia’s rupiah and Brazil’s real also rose sharply. MSCI’s EM equity index climbed 1.9% as investors plowed back into battered tech stocks. The gauge clocked its best two-day rally since November.