Nations from Colombia to Indonesia are taking advantage of the longest emerging-market currencies rally since 2009 to pile up record reserves, bolstering their ability to fend off the next foreign-exchange crisis.
Mexico’s peso posted its best monthly gain since September as prospects for a diplomatic solution to the Ukraine crisis and comments from Federal Reserve Chair Janet Yellen boosted demand for higher-yielding assets.
Argentina’s peso posted its longest losing streak since the country abandoned the dollar peg in 2002 as President Cristina Fernandez de Kirchner seeks to help manufacturers compete against less expensive imports.
Emerging-market currencies that three weeks ago showed the least volatility in a decade are dropping as traders bet slower expansion and an end to interest rate increases may weaken exchange rates from Sao Paulo to Moscow.
Brazilian real traders are paying the highest premium in the world to insure against currency declines after speculation the central bank is done raising rates made it the worst performer over the past month.
Argentine currency traders are paring bets on peso fluctuations to the lowest in 11 months. Farmers are holding on to 23 percent of their record soybean harvest, fueling speculation that export proceeds will climb.