EMERGING MARKETS-Latam currencies weaken on China, N. Korea worries

miércoles 6 de enero de 2016 10:55 GYT

By Bruno Federowski
    SAO PAULO, Jan 6 (Reuters) - Latin American currencies
weakened on Wednesday as investors fretted over economic
weakness in China and a nuclear test by North Korea.
    The People's Bank of China allowed the yuan to weaken to a
record low, fueling fears that the world's second biggest
economy could be weaker than perceived. 
    Data on Wednesday showed activity in China's services sector
expanded at its lowest pace in 17 months in December.
    "Investors are worried about what is going on in China,"
Guide Investimentos analysts wrote in a client note.  
    Traders also avoided risky bets after North Korea said it
successfully tested a miniaturized hydrogen nuclear bomb on
Wednesday. The news added to geopolitical risk, reducing demand
for high-yielding emerging market assets. 
    The Brazilian real weakened 1 percent, while the
Mexican peso fell to its lowest rate against the U.S.
dollar in three weeks.
    The Colombian peso dropped 1.1 percent, tracking a decline
in oil prices to a new 11-year low as a row between Saudi Arabia
and Iran reduced the chances of coordination to cut output.
    Latin American stock indexes and currencies at 1415 GMT:
 Stock indexes                               daily %     YTD %
                                              change    change
 MSCI Emerging Markets               759.47    -1.17     -3.23
 MSCI LatAm                         1755.02    -1.15     -2.97
 Brazil Bovespa                    41756.78    -1.56     -3.68
 Chile IPSA                         3612.99    -0.36     -1.83
 Chile IGPA                        17860.17    -0.31     -1.60
 Currencies                                  daily %     YTD %
                                              change    change
 Brazil real                         4.0340    -1.06    -34.12
 Mexico peso                        17.4425    -0.64    -15.47
 Chile peso                             716    -0.31    -15.31
 Colombia peso                      3247.38    -1.14    -26.46
 Peru sol                            3.4171    -0.14    -12.82
 Argentina peso (interbank)         13.8900    -1.80    -38.44
 Argentina peso (parallel)            14.35    -0.42     -2.44
 (Reporting by Bruno Federowski; Editing by Nick Zieminski)