January 11, 2017 / 2:40 PM / 2 years ago

EMERGING MARKETS-Mexico peso sets record low ahead of Trump conference

By Bruno Federowski
    SAO PAULO, Jan 11 (Reuters) - The Mexican peso weakened to
an all-time low on Wednesday ahead of a news conference by U.S.
President-elect Donald Trump, whose protectionist rhetoric has
weighed on demand for the currency.
    Traders expect Trump to clarify whether he will stand by his
campaign pledges to break with trade agreements with Mexico. 
    Last week, Ford Motor Co scrapped a planned Mexican
car factory following criticism by Trump on Twitter.
    His promises of fiscal stimulus have also raised
expectations of inflationary pressures, which could force the
U.S. Federal Reserve to increase interest rates faster than
    The peso  weakened as much as 0.7 percent on
Wednesday to a historic low of 21.95 to the dollar before paring
back losses to 0.2 percent.
    Other Latin American currencies also slipped, with the
Brazilian real 0.6 percent lower.
    Still, Brazil's benchmark Bovespa stock index inched
up as rising prices of iron ore lifted shares of miner Vale SA
    Shares of Braskem SA, Latin America's largest
petrochemical company, were the biggest gainers in the index.
Braskem agreed late on Tuesday to sell its quantiQ Distribuidora
Ltda to GTM Holdings SA for 550 million reais. 
    Steelmaker Usinas Siderúrgicas de Minas Gerais SA's
 shares fell the most in more than a month after
shareholder Sumitomo Corp vetoed a plan to use some of
a mining subsidiary's capital to jumpstart operations and repay
    Key Latin American stock indexes and currencies at 1415 GMT:
 Stock indexes                                daily %   YTD %
                                               change  change
 MSCI Emerging Markets               886.73      0.12    2.72
 MSCI LatAm                         2368.92     -1.04    2.27
 Brazil Bovespa                    61905.77     -0.36    2.79
 Chile IPSA                         4177.82      0.08    0.64
 Chile IGPA                        20849.43      0.08    0.56
 Venezuela IBC                     32453.15       0.2    2.36
 Currencies                                   daily %   YTD %
                                               change  change
 Brazil real                         3.2151     -0.53    1.06
 Mexico peso                        21.8400     -0.18   -5.02
 Chile peso                           670.6     -0.10    0.01
 Colombia peso                      2971.11     -0.68    1.02
 Peru sol                             3.394     -0.15    0.59
 Argentina peso (interbank)         15.8700     -0.08    0.03
 Argentina peso (parallel)             16.8      0.48    0.12
 (Reporting by Bruno Federowski; Editing by Lisa Von Ahn)
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