Most Latin American currencies rise as dollar stalls globally
Updated at 10:00 a.m. ET/ 1500 GMT
Brazil's government sees inflation within target band
Chile's GDP up 0.7% in Q3 from previous quarter
Latam stocks up 0.4%, FX adds 0.8%
By Shashwat Chauhan
Nov 18 (Reuters) -Most Latin American currencies advanced on Monday, as the dollar's resurgence appeared to ease globally, while elevated prices of commodities such as iron ore and crude oil also helped gains in the region.
Brazil's real BRL= led gains in the region, up 0.9% against the dollar following a local holiday on Friday, while Colombia's peso COP= appreciated 0.4%, aided by elevated crude oil prices.
Over the weekend, Finance Minister Fernando Haddad said in an interview with Times Brasil/CNBC that the Brazilian government's package of spending cuts is practically done and will be released soon, pending only a response from the defense ministry.
Brazil's finance ministry raised its inflation forecasts for this year but expects inflation to remain within the official target band, in contrast to a more negative view held by the markets.
Chile's peso CLP= gained 0.3% after data showed the Andean nation's gross domestic product grew 0.7% in the third quarter of 2024 from the previous three-month period, slightly surpassing market expectations of a 0.6% increase.
Third quarter GDP numbers out of Colombia are due later in the day, while an inflation reading out of Mexico is on Friday.
Most Latin American currencies had clocked weekly losses on Friday as the dollar remained resurgent globally on expectations the Federal Reserve would slow its pace of easing
Uncertainty over the impact of U.S. President-elect Donald Trump's policies on immigration, trade and tariffs have pressured Latin American assets lately, particularly the Mexican peso MXN=, which currently sits near its lowest level in more than a year against the dollar.
"Irrespective of what policies emerge, migration is likely to be a key source of tension between the US and Mexico and Central America which could raise the threat of targeted tariffs or sanctions that exacerbate any economic cost from more protectionist US trade policy," Jason Tuvey, deputy chief emerging markets economist at Capital Economics noted.
Trump's plans for lower taxes and higher tariffs are expected to spur inflation and reduce the Fed's scope to ease interest rates.
MSCI's index for Latin American currencies .MILA00000CUS was up 0.8% after clocking losses last week, while a gauge for stocks .MILA00000PUS added 0.4%.
Bourses in Colombia .COLCAP, Chile .SPIPSA and regional heavyweight Brazil .BVSP were all on the rise.
Equity markets in Mexico and Argentina were closed for a public holiday.
HIGHLIGHTS
** Argentina investors bet on Milei's popularity a year after his election
** Brazil's Lula opens G20 summit with call for action on poverty, climate
** Venezuela depreciation risks reversing years of inflation gains
Key Latin American stock indexes and currencies:
Equities | Latest | Daily % change |
MSCI Emerging Markets .MSCIEF | 1089.11 | 0.38 |
MSCI LatAm .MILA00000PUS | 2085.07 | 0.42 |
Brazil Bovespa .BVSP | 127945.12 | 0.12 |
Mexico IPC .MXX | - | - |
Chile IPSA .SPIPSA | 6538.8 | 0.18 |
Argentina Merval .MERV | - | - |
Colombia COLCAP .COLCAP | 1348.93 | 0.21 |
Currencies | Latest | Daily % change |
Brazil real BRL= | 5.7428 | 0.9 |
Mexico peso MXN= | 20.3507 | -0.24 |
Chile peso CLP= | 976.2 | 0.33 |
Colombia peso COP= | 4405.96 | 0.35 |
Peru sol PEN= | 3.796 | 0.11 |
Argentina peso (interbank) ARS=RASL | 998 | 0.05 |
Argentina peso (parallel) ARSB= | 1120 | 1.79 |
Reporting by Shashwat Chauhan in Bengaluru;
Editing by Alistair Bell
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