Most Latam FX recover some ground after last week's bruising
Poll suggests Brazil's economy will grow at steady pace
Mexican economy grows 1.6% on an annual basis in May
Updated at 3:30 p.m. ET/ 1930 GMT
By Johann M Cherian and Shashwat Chauhan
July 22 (Reuters) -Brazil's and Mexico's currencies led gains in Latin America on Monday, rebounding from the previous week's sell-off, as investors assessed the implications of U.S. President Joe Biden's decision not to seek re-election.
Brazil's real BRL= appreciated 0.4%, after logging its steepest weekly loss since November 2022 on Friday. A poll showed the region's biggest economy will continue growing at a steady pace over the medium term thanks to a continuous rise in public spending that is set to keep fiscal deficits uncomfortably high.
Brazil's government also widened its primary deficit forecast for this year to 32.6 billion reais ($5.9 billion), up from 14.5 billion reais projected in May.
"The fiscal issue remains a point of special concern for traders, fueling volatility for the exchange rate and assets of the Brazilian economy," StoneX analysts wrote in a note.
Mexico's peso <MXN=> recovered 0.6% after notching its biggest weekly drop since early June in the previous session. Data showed the region's second-largest economy grew 1.6% in May on an annual basis, compared with a revised 5.3% growth seen the month before.
Global shares also nudged higher after Biden's decision to bow out of the election race and endorse Vice President Kamala Harris injected a degree of optimism into the markets. MKTS/GLOB
Biden's rival, Republican candidate Donald Trump is seen as a negative for Latin American economies, most of which are led by left-leaning governments. Mexico is considered to be particularly exposed, given the former U.S. president's policies on trade, immigration and security.
On Friday, MSCI's index tracking Latin American currencies .MILA00000CUS logged its biggest weekly drop since early June after an assassination attempt on Trump boosted expectations that he might win a second term at the White House.
Meanwhile, currencies of copper producer Chile CLP= reversed initial losses and last up 0.4%, while Peru's sol PEN= was an outlier, down 0.5%.
Attention will also be on a Group of 20 finance ministers and central bank governors meeting in Brazil later in the week.
On the equities front, an index tracking regional bourses .MILA00000PUS was subdued, while Brazil's Bovespa .BVSP edged up 0.2%
Markets were on the cusp of corporate earnings season in Brazil, with the release of reports from Carrefour CRFB3.SA due after the closing bell, while those from Santander SANB11.SA and Vale VALE3.SA were also on tap.
Mexico's main index .MXX climbed 0.3%, while Argentina's benchmark .MERV gained 0.9%
Key Latin American stock indexes and currencies:
Latest | Daily % change | |
MSCI Emerging Markets .MSCIEF | 1085.64 | -0.36 |
MSCI LatAm .MILA00000PUS | 2258.49 | 0.02 |
Brazil Bovespa .BVSP | 127850.87 | 0.18 |
Mexico IPC .MXX | 53831.83 | 0.29 |
Chile IPSA .SPIPSA | 6588.89 | 0.46 |
Argentina MerVal .MERV | 1582802.46 | 0.878 |
Colombia COLCAP .COLCAP | 1368.58 | 0.07 |
Currencies | Latest | Daily % change |
Brazil real BRBY | 5.5729 | 0.55 |
Mexico peso MXN=D2 | 17.9266 | 0.60 |
Chile peso CLP=CL | 942 | 0.52 |
Colombia peso COP= | 3992.67 | 1.09 |
Peru sol PEN=PE | 3.7548 | -0.48 |
Argentina peso (interbank) ARS=RASL | 925.5000 | -0.05 |
Argentina peso (parallel) ARSB= | 1420 | 1.76 |
Reporting by Johann M Cherian and Shashwat Chauhan in Bengaluru; Editing by Christina Fincher and Alistair Bell
Actifs liés
Dernières actualités
Avertissement : Les entités de XM Group proposent à notre plateforme de trading en ligne un service d'exécution uniquement, autorisant une personne à consulter et/ou à utiliser le contenu disponible sur ou via le site internet, qui n'a pas pour but de modifier ou d'élargir cette situation. De tels accès et utilisation sont toujours soumis aux : (i) Conditions générales ; (ii) Avertissements sur les risques et (iii) Avertissement complet. Un tel contenu n'est par conséquent fourni que pour information générale. En particulier, sachez que les contenus de notre plateforme de trading en ligne ne sont ni une sollicitation ni une offre de participation à toute transaction sur les marchés financiers. Le trading sur les marchés financiers implique un niveau significatif de risques pour votre capital.
Tout le matériel publié dans notre Centre de trading en ligne est destiné à des fins de formation / d'information uniquement et ne contient pas – et ne doit pas être considéré comme contenant – des conseils et recommandations en matière de finance, de fiscalité des investissements ou de trading, ou un enregistrement de nos prix de trading ou une offre, une sollicitation, une transaction à propos de tout instrument financier ou bien des promotions financières non sollicitées à votre égard.
Tout contenu tiers, de même que le contenu préparé par XM, tels que les opinions, actualités, études, analyses, prix, autres informations ou liens vers des sites tiers contenus sur ce site internet sont fournis "tels quels", comme commentaires généraux sur le marché et ne constituent pas des conseils en investissement. Dans la mesure où tout contenu est considéré comme de la recherche en investissement, vous devez noter et accepter que le contenu n'a pas été conçu ni préparé conformément aux exigences légales visant à promouvoir l'indépendance de la recherche en investissement et, en tant que tel, il serait considéré comme une communication marketing selon les lois et réglementations applicables. Veuillez vous assurer que vous avez lu et compris notre Avis sur la recherche en investissement non indépendante et notre avertissement sur les risques concernant les informations susdites, qui peuvent consultés ici.
