(Recasts throughout, updates prices) By Susan Mathew Jan 2 (Reuters) - A record high for Brazil shares and a more than 2 percent gain in the real, spurred by positive policy moves by the country's new government, helped Latin American markets make a strong start to the new year and buck gloom in global markets on Wednesday. Far-right President Jair Bolsonaro's administration took office on Tuesday and was quick to issue decrees affecting the economy, agriculture and society, while forging closer political ties with the United States. "Focus (is) on the new administration in Brazil and there is a lot of expectation for some good change for the business side of the economy," said Robert Lutts, president and chief investment officer at Cabot Wealth Management Inc. Brazil shares surged as much as 4.1 percent to hit an all-time high before retreating slightly to close 3.6 percent higher. The real firmed 2.4 percent and posted its best day in more than seven months. Markets welcomed reports that economy minister Paulo Guedes, a market favorite, had drafted a temporary executive decree for a much needed reform of the country's bloated pension system that could save up to 50 billion reais ($12.9 billion) over the next decade. However, "strong opposition in congress is expected," emerging market analysts Dirk Willer and Kenneth Lam from Citigroup said in a note. "The strategy is to roll out a package of changes which don't require congressional approval." State-run power company Eletrobras was the top gainer on the Bovespa stock index, up more than 20 percent, after the government said it would carry out a partial privatization of the electricity generation company. The MSCI index of Latin American shares rose 3.8 percent, hitting a one-month peak in the session as a 2.7 percent jump in Argentine shares and an over 1 percent rise in Mexico's IPC stock index added to its gains. The Latam index outperformed the broader emerging markets as well the world stock indexes as concerns about slowing global growth were reinforced by weak Chinese and European data. Among currencies, those of net crude exporters such as the Mexican and Colombian pesos firmed despite a strong dollar as oil prices rose. Mexico's currency touched a two-month high. The Chilean peso weakened, mirroring a decline in the price of copper, the country's main export. Key Latin American stock indexes and currencies at 2123 GMT: Stock indexes Latest Daily % change MSCI Emerging Markets 955.66 -1.06 MSCI LatAm 2663.19 3.79 Brazil Bovespa 91012.31 3.56 Mexico IPC 42284.85 1.55 Chile IPSA 5125.37 0.39 Argentina MerVal 31096.63 2.65 Colombia IGBC 11181.22 0.33 Currencies Latest Daily % change Brazil real 3.7835 0.68 Mexico peso 19.5444 0.50 Chile peso 697.3 -0.52 Colombia peso 3237.5 0.23 Peru sol 3.368 0.00 Argentina peso 37.6000 0.27 (interbank) (Reporting by Susan Mathew in Bengaluru; Editing by James Dalgleish)
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