January 20, 2020 / 2:52 PM / in a month

EMERGING MARKETS-Chilean peso leads Latam FX higher as stocks pause

    By Shreyashi Sanyal
    Jan 20 (Reuters) - The Chilean peso led a rise in Latin
American currencies on Monday, taking their cue from firmer
copper prices as stocks took a breather ahead of key central
bank meetings this week. 
    Chile, the world's top producer of copper, saw its currency
 firm 0.5% to 770.90 to the dollar after data on Friday
showed a surprise acceleration in Chinese industrial output. 
    A basket of currencies in Latin America rose
0.1%, following two consecutive days of declines. 
    Now the focus will shift to monetary policy as the Bank of
Japan gears up to announce its rate decision on Tuesday. The
European Central Bank has its first meeting of the year on
    Investors have heightened their exposure to riskier assets
after the cooling of trade tensions between the United States
and China, with optimism rising following the signing of an
initial trade deal between the two sides last week. 
    "Accommodative policy and the reduction of downside risk
following the signing of the Phase 1 U.S.-China trade deal will
help support the economy and risk assets," said Mark Haefele,
chief investment officer at UBS Global Wealth Management.
    But the Brazilian real weakened 0.5% to 4.1836
against the dollar and was among the few major Latin American
currencies in the red. 
    "The Brazilian real is the worst performer with its small
trade exposure to China limiting support from the signing of the
US/China Phase 1 trade deal," said Jane Foley, senior FX
strategist at Rabobank.     
    Brazil's main stock index fell 0.2% with shares of  
B3 SA, the operator of the Sao Paulo stock exchange,
down 1%.
    Eyes will also be on Colombia's peso as the price of
oil, the country's main export, shot up after two large crude
production bases in Libya began shutting down amid a military
blockade, risking reducing crude flows from the OPEC member to a
    Key Latin American stock indexes and currencies at 1437 GMT:
    Stock indexes             Latest    Daily % change
 MSCI Emerging Markets         1145.12           -0.15
 MSCI LatAm                    2922.38           -0.08
 Brazil Bovespa              118279.82           -0.17
 Mexico IPC                          -               -
 Chile IPSA                    4861.72            -0.4
 Argentina MerVal             42832.49           1.164
 Colombia COLCAP               1660.49            0.27
       Currencies             Latest    Daily % change
 Brazil real                    4.1836           -0.47
 Mexico peso                   18.6669           -0.06
 Chile peso                      770.2            0.30
 Colombia peso                 3330.75            0.00
 Peru sol                       3.3208            0.01
 Argentina peso                59.9500            0.10

 (Reporting by Shreyashi Sanyal in Bengaluru; editing by Nick
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