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Chile holds rates steady
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Argentina's cbank hikes interest rates to 97%
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Brazil's Petrobras to discuss fuel pricing policy change
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Turkey assets weaken as presidential runoff looms
By Amruta Khandekar
May 15 (Reuters) - Latin American currencies gained on
Monday with Chile's peso hitting an over three-month high, while
Turkish assets were pressured as presidential elections headed
towards a runoff between incumbent Tayyip Erdogan and his main
rival.
The peso climbed 0.7%, extending gains from Friday,
when the country's central bank kept its benchmark interest rate
unchanged at 11.25%.
"We agree that a tight monetary stance is still warranted
and believe that the policy rate will need to remain above
neutral for some time. In our view, the MPC (monetary policy
committee) will remain patient, waiting until September to start
cutting rates," Goldman Sachs analysts said in a research note.
Also helping the peso was a rebound in copper prices, after
a liquidity injection by top consumer China's central bank
demonstrated support for the Chinese economy.
The currency of Peru , which is the second biggest
copper exporter after Chile, gained 0.2%, after hitting a fresh
one-year high earlier in the session.
The Colombian peso , the currency of a major oil
exporting nation, jumped 0.8%, as crude prices edged higher. .
The country's first-quarter gross domestic product (GDP)
data is due later in the day.
The Brazilian real was down 0.1%, while the
Argentinian peso weakened to 230.60 against the
dollar after the country's government introduced a package of
measures on Sunday to battle inflation. The Argentinian central
bank hiked interest rates by 600 basis points to 97%, an
official said on Monday.
MSCI's Latin American currencies index was
up 0.1% at 1357 GMT, hovering around multi-year highs hit
several times earlier this year amid evidence of cooling U.S.
inflation which has fed hopes of a rate hike pause by the
Federal Reserve.
Meanwhile, Turkey's lira held near a two-month low, its
sovereign dollar bonds tumbled and the cost of insuring exposure
to the country's debt spiked as president Erdogan performed
better than expected during Sunday's election but fell short of
an outright majority.
The results disappointed investors hoping for an opposition
win which could result in a monetary policy shift. A second
round of voting will be held on May 28.
Latam stocks gained 0.2%.
Brazil's Petrobras is moving closer to making
changes to its fuel pricing policy and executives are set to
meet this week to analyze a new model. Shares of the state-run
oil giant fell 2.1% in early trade.
Azul SA said it expects to increase capacity by
around 14% in 2023 after net loss narrowed in the first quarter.
Still, shares of the Brazilian airline were down 8.6%.
The International Monetary Fund (IMF) mission in Sri Lanka
will evaluate progress made on reforms so far and complete an
exercise to improve governance in key areas of the economy, an
IMF official said on Monday.
Ghana expects the International Monetary Fund to approve a
first loan tranche of $600 million as soon as Wednesday,
Minister of State in the Finance Ministry Mohammed Amin Adam
told Reuters on Sunday.
Key Latin American stock indexes and currencies at 1357 GMT:
Stock indexes Latest Daily %
change
MSCI Emerging Markets 976.29 0.34 MSCI LatAm 2316.45 0.16 Brazil Bovespa 108656.21 0.18 Mexico IPC 55058.11 0.2 Chile IPSA 5607.65 0.19 Argentina MerVal 0.00 0 Colombia COLCAP 1159.64 0.04 Currencies Latest Daily %
change
Brazil real 4.9255 -0.08
Mexico peso 17.6029 -0.12 Chile peso 781 0.71
Colombia peso 4502.62 1.16
Peru sol 3.659 0.15
Argentina peso 230.6000 -0.56
(interbank) Argentina peso 470 0.85
(parallel) (Reporting by Amruta Khandekar; Editing by Maju Samuel)
