NEW YORK, July 12 (Reuters) - The Chilean peso on Tuesday hit a fresh record low against the dollar as the government raised its inflation estimates ahead of an expected interest rate hike, while Hungary's forint struggled for direction after a hefty rate increase to stem the currency's plunge.
The dollar was little changed on Tuesday and has benefited from expectations that the U.S. Federal Reserve will continue to hike rates aggressively than peers.
“Latam central banks are going to strike while the iron is hot – once the U.S. Federal Reserve eases off from rate hikes, that will determine if those currencies can start moving up against the dollar,” said Juan Perez, director of trading at Monex USA.
“However, the dollar can only be knocked off if the global outlook starts improving. For the next month, it’s difficult to see that happening.”
Brazil’s real slipped 0.99% to trade at 5.42 to the dollar. The country’s growth spurt this year has been overshadowed by worries ahead of October’s presidential vote, dampening the outlook for 2023, a Reuters poll showed.
