Emerging Markets: Latam FX rises for sixth straight session against see-sawing dollar

First Citizens Bancshares (Tennessee)

27/03/2023 20:29

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      Colombia's peso hits over 7-week highs against dollar
    

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      Peru may tap capital markets this year to better manage
debt 
    

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      Brazil's Lula cancels trip to China 
    

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      No date yet for Brazil's new fiscal framework -minister
    

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      Latam stocks up 1.5%, FX adds 0.7%
    

  
 (Updates prices, details)
    By Bansari Mayur Kamdar
       March 27 (Reuters) - Colombia's peso rallied over 1% as
the U.S. dollar slipped on Monday, leading Latin American
currencies higher for their sixth straight session as fears of a
global banking crisis ebbed.
    Latin American markets tracked the recovery in their U.S.
peers after First Citizens BancShares  FCNCA.O  said it would
take the deposits and loans of failed Silicon Valley Bank
 SIVB.O , helping calm fears of banking contagion.
    The MSCI's index for Latam currencies  .MILA00000CUS  gained
0.7% by 1850 GMT.
    "What you're seeing today is not necessarily a return to
risk appetite or anything major like that, but the nature of
last week's chaos did give a bad taste and reminder of what 2008
was like," said Juan Perez, director of trading at Monex USA.
    The FX index was on track to end the first quarter 5.8%
higher, outpacing EM peers  .MIEM00000CUS , supported by a
weakening dollar and firm commodity prices.
    The peso  COP=  rose 1.4% against a subdued dollar, hitting
its highest level in over seven weeks, with firm crude prices
also supporting the currency of the oil producer.  O/R 
    Investors focused on Colombia's central bank, which is
expected this week to raise interest rates 25 basis points to
13%.
    "The MPC may complement this (25 bps) move with guidance
suggesting that with such a hike the policy stance becomes
significantly restrictive to lay the groundwork for eventually
stopping the tightening cycle, although we do not anticipate
that the MPC will explicitly close the door to further hikes,"
Goldman Sachs analysts said in a note.
    Stocks in Colombia  .COLCAP  gained 0.7%, with majority
state-owned energy company Ecopetrol  ECO.CN  adding 1.6% on
naming Alberto Consuegra as its interim CEO on Friday. 
    Mexico's peso  MXN= , Chilean peso  CLP=  and Peru's sol
 PEN=  each gained 0.4%.
    Peru's government expressed qualified interest in tapping
the international bond market later this year in a bid to better
manage liabilities, said Economy Minister Alex Contreras.
    In Brazil, the real  BRL=   BRBY  added 0.6% against the
greenback, while stocks  .BVSP  advanced 1.1%.
    Brazil's President Luiz Inacio Lula da Silva canceled a trip
to China due to medical reasons.
    Focus shifted to an eagerly awaited fiscal framework in
Brazil, which was initially promised by Finance Minister
Fernando Haddad for March but was postponed by Lula until after
the planned China trip.
    Brazilian Institutional Relations Minister Alexandre Padilha
said no date has been set for the presentation of the proposed
new fiscal rules.
    Brazilian data showed a lower-than-expected current account
deficit in February, mainly due to a decrease in factor
payments.
    Elsewhere in emerging markets, Israel's shekel  ILS=  pared
early gains in a volatile session after Prime Minister Benjamin
Netanyahu delayed a decision on bitterly contested plans for a
judicial overhaul.
    
    Key Latin American stock indexes and currencies at 1850 GMT:
       Stock indexes                 Latest      Daily %
                                                  change
 MSCI Emerging Markets                  964.70       -0.77
  .MSCIEF                                       
 MSCI LatAm  .MILA00000PUS             2107.80        1.49
 Brazil Bovespa      .BVSP            99986.30        1.17
 Mexico IPC           .MXX            52914.17        0.27
 Chile IPSA          .SPIPSA           5262.72        0.28
                                                
 Colombia COLCAP      .COLCAP          1114.46        0.74
                                                
                                                          
          Currencies                 Latest      Daily %
                                                  change
 Brazil real        BRBY                5.2173        0.62
                                                
 Mexico peso        MXN=D2             18.3552        0.32
                                                
 Chile peso       CLP=CL                 806.4        0.47
 Colombia peso  COP=                      4673        1.38
 Peru sol         PEN=PE                 3.765        0.19
                                                
 Argentina peso (interbank)           207.4100       -0.79
  ARS=RASL                                      
 Argentina peso (parallel)                 386        0.78
  ARSB=                                         
 
 (Reporting by Bansari Mayur Kamdar and Shashwat Chauhan in
Bengaluru; Editing by Alison Williams and Richard Chang)
 ((BansariMayur.Kamdar@thomsonreuters.com;  Twitter:
@BansariKamdar;))