The Brazilian real strengthened on Friday, closing 1.63 percent higher against the dollar as the country's central bank refrained from intervening to curtail a rally triggered by lower expectations of U.S. rate increases this year.
Brazil's central bank abstained from acting to weaken the currency despite doing so almost daily in July. Also boosted by the U.S. data, the Mexico peso gained 0.69 percent to close at 18.76 pesos per dollar.
The U.S. economy grew far less than expected in the second quarter, leading many investors to roll back bets on a near-term rate hike by the Federal Reserve. Keeping U.S. rates lower for longer would maintain the allure of high-yielding emerging market assets, lifting currencies from Latin America.
Brazil's benchmark Bovespa stock index was up more than 1 percent on Friday, driven by shares in Petrobras, which rose after the state-controlled oil company sold off a US$2.5 billion stake in an offshore exploration license.
The sale is the first in a US$15 billion divestment program as Petrobras seeks to cut debt and revive investor confidence amid a sweeping graft scandal. In Mexico, the stock index fell 0.37 percent, affected by a drop in shares of telecoms company América Móvil, which posted a 45 percent slump in second-quarter profit on Thursday evening.
América Móvil's share price hit its lowest in over seven years during the session.