August 27, 2019 / 7:42 PM / 10 months ago

EMERGING MARKETS-Most Latam currencies fall on U.S.-China trade uncertainty

 (Updates prices, changes comment)
    * Brazilian real bucks trend after central bank intervenes
    * Chile's peso near 3-yr lows 
    * Mexican stocks lead Latam equities higher 

    By Agamoni Ghosh
    Aug 27 (Reuters) - Latin American currencies fell against
the U.S. dollar on Tuesday as investors remained on edge over
twists and turns in the U.S.-China trade dispute, but an index
of the region's stocks snapped a three-day run of losses.
    MSCI's index of Latin American stocks rose
0.7% but currencies slipped 0.3% as investors
assessed conflicting comments from U.S. and Chinese officials
over the drawn-out trade dispute.
    President Donald Trump sought to ease tensions by predicting
another round of talks with Beijing on Monday, although China's
foreign ministry said it had not received any recent phone call
from the United States on trade.
    Chile's peso hovered at three-year lows as the price
of copper, the country's top export, remained near
two-year lows on worries about damage to industrial activity and
demand from the prolonged trade dispute.
   "As a small open economy, with an export basket heavily
skewed towards copper, the CLP has weakened in recent months,
following a trajectory that closely matches copper price
trends," said Gustavo Rangel, chief economist, Latam, at ING.  
    "The currency's near-term outlook remains closely tied to
trade war concerns and global growth dynamics."     
    Chile's Finance Minister announced on Monday $600 million in
additional stimulus in an effort to kick-start the top copper
producer's sputtering economy.
    The Argentine peso shed 1.6% despite an intervention
by the central bank to support the currency.      
    Argentina's central bank on Tuesday sold $302 million of its
dollar reserves, breaking a guideline on reserve sales agreed as
part of its $57 billion standby agreement with the International
Monetary Fund.
    The central bank has sold more than $1 billion of its own
reserves to support the currency against political uncertainty
touched off by the left-wing opposition's resounding victory in
a primary vote this month for October's presidency election.
    Brazil's real, which has lost nearly 8% this month,
was the only regional currency to gain against the dollar after
the central bank intervened, offering to sell dollars on the
spot market.
    Central bank president Roberto Campos Neto said the economy
was stable or expanded only slightly in the second quarter,
indicating that low inflation meant there is room for more
    Most stock indices in the region rose with Mexican stocks
 leading the way, up 1.5%. Stocks in Buenos Aires
lagged the broader equities trend, ending 4% lower, pressured
heavily by financials.   
    Key Latin American stock indexes and currencies at 1915 GMT
 Stock indexes                                 daily % change
 MSCI Emerging Markets              964.28               0.36
 MSCI LatAm                        2495.83                0.8
 Brazil Bovespa                   97418.26               1.03
 Mexico IPC                       40689.92               1.52
 Chile IPSA                        4645.54               0.63
 Argentina MerVal                 24802.01                 -4
 Colombia IGBC                    12339.44               0.13
 Currencies                                    daily % change
 Brazil real                        4.1450              -0.15
 Mexico peso                       20.0086              -0.38
 Chile peso                            722              -0.37
 Colombia peso                     3469.23              -1.10
 Peru sol                            3.393              -0.32
 Argentina peso                    56.1500              -1.50
 (Reporting by Agamoni Ghosh and Sruthi Shankar
Editing by Sonya Hepinstall)
Nuestros Estándares:Los principios Thomson Reuters
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