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Colombia's consumer prices rise 1.66% in Feb
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Brazil's Azul gains on upbeat outlook
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Inflation data from Brazil, Mexico, Chile due this week
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Latam FX up 0.3%, stocks down 0.2%
By Amruta Khandekar March 6 (Reuters) - Latin American currencies edged higher against a softer dollar on Monday as investors awaited Federal Reserve Chair Jerome Powell's testimony for clues on the U.S. rate hike trajectory, with Colombia's peso rising for the fourth straight session. MSCI's index for Latam currencies was up 0.3% by 1458 GMT while the broader EM currencies gauge was flat. Powell is set to testify before Congress on Tuesday and Wednesday, with investors on the look-out for clues on the central bank's monetary policy tightening plans after concerns around U.S. interest rates staying higher for longer dealt a blow to risk sentiment in February. Still, recent commentary from other Fed officials has calmed jitters, with markets now pricing in three 25-basis-point rate hikes from the central bank. "We are moving towards an expectation for tighter rates," said Cristian Maggio, head of portfolio strategy at TD Securities. "There could be a risk that (Powell's) rhetoric will push interest rates to the upside." The Colombian peso rose 1% against the dollar to hit an over three-week high. Colombia's consumer prices rose 1.66% in February, the country's DANE statistics agency announced on Saturday, taking cumulative 12-month price growth to 13.28%. The Brazilian real fell 0.1% in early trade while Mexico's peso also slipped from five-year highs touched in the previous session driven by a widening rate differential between Banxico and the U.S. Federal Reserve. Mexican automotive production and exports rose in February from the same month a year earlier, data from the national statistics agency (INEGI) showed on Monday.
The Chilean peso rose 0.1% against the greenback while the Peruvian sol edged 0.2% lower. Investors are awaiting inflation data from Chile, Brazil and Mexico this week as they try to gauge how close central banks in the region are to ending their tightening cycle. Latam stocks were down 0.2%, trailing behind broader EM stocks , which rose 0.5%. Argentina's Merval index rose 0.1%. The inflation rate in the country is seen hitting 99.9% in 2023, speeding up from last year's rate and topping previous estimates which saw a slightly slower rise, according to a central bank poll of analysts released Friday.
Brazil's Bovespa edged 0.3% lower, hurt by mining stocks, though losses were limited by an 28.3% advance in Azul SA after the airline projected positive cash flow in 2024 and beyond.
Shares of its peer Gol Linhas Aereas Inteligentes SA also jumped 20.1%. Key Latin American stock indexes and currencies at 1458 GMT:
Stock indexes Latest Daily % change MSCI Emerging Markets 993.30 0.53 MSCI LatAm 2213.65 -0.08 Brazil Bovespa 103597.61 -0.26 Mexico IPC 54134.52 -0.09 Chile IPSA 5437.28 -0.04 Argentina MerVal 244934.53 -0.379 Colombia COLCAP 1221.84 0.6 Currencies Latest Daily % change Brazil real 5.2003 -0.05 Mexico peso 17.9857 -0.24 Chile peso 802.5 0.14 Colombia peso 4728.81 1.18 Peru sol 3.7789 -0.21 Argentina peso 199.3300 -0.52 (interbank) Argentina peso 371 1.08 (parallel) (Reporting by Amruta Khandekar; Editing by Emelia Sithole-Matarise)
