April 4, 2017 / 8:39 PM / a year ago

EMERGING MARKETS-Mexico peso pares losses ahead of intervention

 (Updates prices)
    By Bruno Federowski
    SAO PAULO, April 4 (Reuters) - The Mexican peso pared losses
on Tuesday after the country's central bank announced it would
intervene in the foreign exchange market in an effort to ease
pressure on the currency.
    Mexico's central bank said it would sell up to $200 million
worth of currency hedging instruments to roll over paper set to
expire on Wednesday, just ahead of a meeting between U.S.
President Donald Trump and Chinese President Xi Jinping.
    The bank had originally issued the instruments as a way to
stem the peso's slide following the election of Trump, who
threatened to scrap trade agreements with Mexico.
    The peso has since made up some lost ground as those
concerns eased, with investors betting that he would not impose
big tariffs on Mexican exports to the United States.
    Still, the peso fell the most among Latin American
currencies, weakening more than 0.8 percent.
    Most Latin American currencies fell ahead of the Xi meeting,
which Trump has said "will be a very difficult one." He has held
out the possibility of using trade as a lever to secure China's
cooperation against North Korea.
    Stock markets in the region were largely buoyant.
    Argentina's benchmark stock index rose about 0.9
percent, touching a record high for the sixth straight trading
day, after agency S&P raised the country's sovereign rating by a
notch to B from B-.
    Key Latin American stock indexes and currencies at 2020 GMT:
 Stock indexes                    Latest        Daily  YTD pct
                                                  pct   change
 MSCI Emerging Markets                965.17     0.02    11.93
 MSCI LatAm                         2,669.06     0.44    14.03
 Brazil Bovespa                    65,768.91     0.85     9.20
 Mexico IPC                        49,342.77     1.07     8.11
 Chile IPSA                         4,825.76     0.71    16.24
 Chile IGPA                        24,158.32      0.6    16.51
 Argentina MerVal                  20,744.08     0.88    22.62
 Colombia IGBC                     10,180.99     0.07     0.52
 Venezuela IBC                     45,739.70     3.99    44.27
 Currencies                           Latest    Daily  YTD pct
                                                  pct   change
 Brazil real                          3.0978     0.55     4.89
 Mexico peso                         18.8305    -0.85    10.16
 Chile peso                            660.4    -0.33     1.56
 Colombia peso                       2,865.2     0.00     4.76
 Peru sol                               3.25     0.00     5.05
 Argentina peso (interbank)          15.3550     0.31     3.42
 Argentina peso (parallel)             15.83     1.01     6.25

 (Reporting by Bruno Federowski; Editing by Diane Craft and Dan
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