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Brazil govt to resume fuel taxes -ministry
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Mexico posts $32 mln trade surplus in Jan
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Chile's unemployment rises slightly in Nov-Jan
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Latam FX up 0.2%, stocks add 0.8%
(Adds comments, details; updates prices)
By Amruta Khandekar and Bansari Mayur Kamdar
Feb 27 (Reuters) - Most Latin American currencies rose
against a weakening dollar on Monday, outperforming peers in the
broader emerging market, with the Colombian peso extending gains
for the fourth straight session.
MSCI's index for Latin American currencies edged 0.2% up against a softer dollar at 1915 GMT, while the
broader emerging market currency index was down 0.1% .
Leading regional gains, Colombia's peso rose 1.7%
against a softer dollar.
However, the peso was still on track to end the month 1.8% lower amid ongoing political tensions.
"Heightened policy uncertainty and risk emanating from an aggressive reform agenda (e.g. pension, labor, and healthcare reforms) may hurt sentiment and create headwinds for activity," said Goldman Sachs economists in a note. Additionally, after a strong start to 2023, emerging markets assets have come under pressure in recent weeks after suprisingly strong U.S. economic data doused expectations that the Federal Reserve will pause its rate hiking cycle, which weighed on risk sentiment and bolstered the dollar . "Likely further short-term USD upside suggests that EM FX will remain on the back foot versus USD amid a tightening in U.S. rate expectations," TD Securities strategists said in a note.
The Brazilian real rose 0.4% against the dollar, giving up some early gains after the finance ministry said the Brazilian government was set to resume the collection of federal taxes on fuels this week. Brazil's central government posted a better-than-expected primary budget surplus in January on the back of record tax revenues, Treasury data showed, although the outlook for the year is for a large deficit. Investors now wait for Brazil's fourth-quarter gross domestic product report due on Thursday. Mexico's peso inched up 0.1%. Latin America's second-largest economy posted a $32 million trade surplus in January when adjusted for seasonal swings, data showed. Mexico's citizens on Sunday staged what appeared to be the largest protest so far against President Andres Manuel Lopez Obrador's administration to condemn government moves to shrink the electoral authority as a threat to democracy. The Chilean peso , which fell the most among the region's major currencies last week, fell 0.7% as copper prices extended losses. Chile's unemployment rate hit 8.0% in the November-January period, government statistics agency INE said on Monday, matching economists' forecasts in a Reuters poll and inching up from 7.9% in the quarter through December. Latin American stocks rose 0.8%, outperforming the 0.4% slide in the broader emerging market stocks index .
Key Latin American stock indexes and currencies:
Stock indexes Latest Daily % change MSCI Emerging Markets 967.74 -0.42 MSCI LatAm 2211.11 0.76 Brazil Bovespa 106177.52 0.36 Mexico IPC 53102.91 0.79 Chile IPSA 5357.07 0.48 Argentina MerVal 251015.76 1.084 Colombia COLCAP 1207.88 1.2
Currencies Latest Daily % change
Brazil real 5.1905 0.14
Mexico peso 18.3808 0.06
Chile peso 831.4 -0.55
Colombia peso 4754.5 1.74
Peru sol 3.7977 0.56
Argentina peso (interbank) 196.7900 -0.54 Argentina peso (parallel) 373 1.61 (Reporting by Amruta Khandekar and Bansari Mayur Kamdar;
Editing by Shounak Dasgupta and Tomasz Janowski)
