Dec 10 (Reuters) - Brazil's real led losses among Latin American currencies on Friday as inflation slowed but remained around a six-year high, while uncertainty over a U.S. Federal Reserve rate hike, amid rising prices, kept most regional assets in a tight range.
U.S. consumer prices increased further in November amid supply constraints and saw their largest annual gain since 1982, which could encourage the Fed to tighten policy earlier, denting appeal for risky assets. read more
The real , dropped 0.2% as data showed Brazilian consumer prices rose less than expected in November, but still marked their strongest print for the month in six years, underscoring the central bank's tough task controlling rising costs in Latin America's largest economy.
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"Disinflation of the economy and anchoring long-term inflation expectations are likely to take time and will require a very restrictive monetary policy," Credit Suisse analysts wrote in a note.
"We maintain our expectation that the Central Bank will raise the Selic interest rate ... to 12.25% by May 2022."
Brazil's central bank hiked its rates by 150 basis points to 9.25% earlier this week and hinted at another hike of the same magnitude at its next meeting due in February.
Sao Paulo stocks (.BVSP) jumped 1.5%.
Shares in Brazilian wood panel manufacturer Dexco SA (DXCO3.SA) rose more than 5% in early trade after its board approved an early payout of dividends to shareholders.
The currencies of oil exporting countries Mexico and Colombia gained 0.3% and 0.4%, respectively, and were set to gain for the second consecutive week as they tracked stronger oil prices.
Mexican industrial output rose 0.6% in October from September and was 0.7% higher year-over-year, the national statistics agency said on Friday.
Market sentiment towards riskier emerging economies has been buoyed this week by easing concerns over the Omicron coronavirus variant's impact on global economic growth.
The Peruvian sol firmed 0.2% after its central bank on Thursday raised its benchmark interest rate by 50 basis points to 2.5%, in its fifth rate hike in a row as persistent inflation spreads through the Andean nation.
The currency of world's top copper exporter Chile dropped 0.2% and was the worst performing currency among its Latin American peers this week, down 1%. Demand uncertainties in top metals consumer China have weighed on copper prices in recent weeks.
Chile's central bank is widely expected to hike its benchmark interest rate next week to prevent the economy from overheating during a post-COVID bounce.
Investors were also awaiting monetary policy rate decisions in the United States, Britain, the euro zone, Russia and Mexico next week.
Key Latin American stock indexes and currencies:
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Reporting by Shashank Nayar in Bengaluru Editing by Mark Potter
Our Standards: The Thomson Reuters Trust Principles.
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Brazil's real falls as inflation sticks to six-year peak - Reuters
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