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Brazil's mid-April inflation below estimates
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Bank of Mexico to consider holding interest rate steady
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Colombian peso, Treasury bonds fall on cabinet reshuffle
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Argentina's peso recovers in choppy trading
By Bansari Mayur Kamdar April 26 (Reuters) - Colombia's peso fell on Wednesday after President Gustavo Petro asked his cabinet ministers to resign ahead of a reshuffle, while the Argentinian peso rebounded slightly after sharp losses this week on the black market amid political and economic turmoil. The Colombian peso shed 0.9% to 4545.28 per dollar at 11:00 a.m. ET as the leftist leader said he had lost his majority coalition in Congress.
A debate on the president's health reform had had to be abandoned after not reaching the necessary quorum. "The market reaction is initially negative on the noise that this creates and the risk of potential radicalization of the Petro government if he has to replace members of his cabinet from the coalition to more members from his own party," said Alejandro Cuadrado, Latin America strategist and global head of FX at BBVA. "The key person risk in what happens to Finance Minister Jose Antonio Ocampo ... There's more chances than not that Ocampo actually stays and eventually the confirmation of him staying should limit the movement (on peso)." The yield on 10-year TES Treasury bonds sold in the domestic market, set to come due in February 2033, was down to 11.739% from Tuesday's close of 11.425% Argentina's peso recovered slightly after opening sharply lower on parallel markets, but continued to hover near 500 per dollar amid rising political turmoil ahead of October's election, pressuring President Alberto Fernandez government to devalue the currency, something he has long resisted. "This is still an accumulation of imbalances and high inflation, so that continues to pressure the exchange rate," added Cuadrado. "Our base case is for the government to try to muddle through this and hand over to the next administration, aiming to avoid adjustments in the exchange rate." In Brazil, the real was flat against the dollar after data showed inflation slowed by more than expected in the year to mid-April, backing the government's calls for an interest rate cut even as the central bank maintains a hawkish tone.
Chile's peso added 0.7% against the dollar as the top copper producer was expected to benefit from the recovery in copper prices and weakness in the U.S. dollar.
No. 2 copper producer Peru's currency rose 0.6% against the dollar, while Mexico's peso slipped 0.3% against the dollar. The Bank of Mexico's governing board may consider keeping its benchmark interest rate steady at its next monetary policy meeting, in what would be its first rate hold after 15 straight hikes, Central Bank Governor Victoria Rodriguez said on Tuesday.
Key Latin American stock indexes and currencies:
Stock indexes Latest Daily
%
change
MSCI Emerging Markets 968.68 0.32
MSCI LatAm 2208.87 0.13
Brazil Bovespa 102907.4 -0.3
5
Mexico IPC 54426.91 0.1
Chile IPSA 5309.05 0.18
Argentina MerVal 298111.9 -1.632
5
Colombia COLCAP 1193.51 -0.35
Currencies Latest Daily
%
change
Brazil real 5.0509 0.24
Mexico peso 18.1193 -0.27
Chile peso 806.9 0.78
Colombia peso 4543.18 -0.78
Peru sol 3.7383 0.13
Argentina peso (interbank) 221.5500 -0.30
Argentina peso (parallel) 477 3.77
(Reporting by Bansari Mayur Kamdar in Bengaluru; Editing by Alison Williams)
@BansariKamdar;))