EMERGING MARKETS-Latam currencies near flat as oil slumps, yuan rises
By Bruno Federowski SAO PAULO, Jan 18 (Reuters) - Latin American currencies were little changed on Monday as oil prices dropped to their lowest level since 2003, offseting a rise in the Chinese yuan. Crude prices tumbled as the lifting of sanctions against Iran boosted expectations of more oil supply on the world market, dragging other commodities lower as well. Demand for high-yielding assets has also been hit by concerns over economic weakness in China, the world's top consumer of basic goods. Measures announced by the Chinese central bank to contain speculation on the yuan helped calm investors, lifting the country's currency and shares. Trading volumes were thin in most Latin American markets due to a U.S. holiday. "Foreign factors have been the main driver of currency movements this year, so markets deplete when there is a U.S. holiday," said Paulo Celso Nepomuceno, a strategist at Coinvalores brokerage in São Paulo. The Mexican peso rose 0.2 percent after posting its steepest loss in nearly two and a half years on Friday. The Brazilian real was nearly flat, while the country's Bovespa stock index fell 0.8 percent. Shares of Petroleo Brasileiro SA dropped to 5 reais for the first time since 2003 as traders fretted over cuts in the state-controlled oil company's investment plans. Petrobras, as the company is known, has been kept out of most capital markets by a corruption scandal. Brazilian President Dilma Rousseff said on Friday that she would not rule out the possibility that the government may have to pump more cash into the company. Latin American stock indexes and currencies at 1440 GMT: Stock indexes daily % YTD % change change Latest MSCI Emerging Markets 704.07 -0.72 -10.7 MSCI LatAm 1617.68 -0.5 -11.15 Brazil Bovespa 38254.62 -0.82 -11.75 Mexico IPC 40761.14 -0.21 -5.16 Chile IPSA 3480.40 -0.17 -5.43 Chile IGPA 17272.22 -0.14 -4.84 Argentina MerVal 10017.07 -0.03 -14.20 Colombia IGBC 8031.95 -0.12 -6.03 Venezuela IBC 14574.27 0.53 -0.10 Currencies daily % YTD % change change Latest Brazil real 4.0436 0.04 -2.39 Mexico peso 18.2355 0.19 -5.51 Chile peso 730.2 0.14 -2.81 Colombia peso 3299.99 0.00 -3.96 Peru sol 3.4251 0.12 -0.32 Argentina peso (interbank) 13.4000 0.37 -3.12 Argentina peso (parallel) 14.33 0.56 -0.42 (Editing by Nick Zieminski)
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