Emerging Markets: LatAm assets rebound as dollar slips, global yields retreat

Vale

19/08/2026 20:41

MSCI LatAm assets headed for best day this month
30-year US Treasury yield falls nearly 10 basis points
Dollar falls 0.8%, easing pressure on emerging-market FX
Fed policymakers inflation concerns increased in July - minutes
Updates to afternoon trading levels, adds analyst comments
By Ragini Mathur, Utkarsh    Hathi and Mehnaz Yasmin
Aug 19 (Reuters) - Most Latin American equities and currencies rebounded on Wednesday, as the U.S. dollar tumbled and Treasury yields retreated from multi-decade highs, fueling a relief rally in the region's assets.
     The MSCI Latin America equities index .MILA00000PUS jumped 1.2%, while a regional currency gauge .MILA00000CUS climbed 0.5%. Both were still on track for their strongest daily performance so far this month.
The relief rally followed a U.S. Treasury announcement aimed at boosting liquidity in long-term debts to stop the upward march in yields, which had rattled investors and dented risk appetite across global markets. 
The benchmark 30-year U.S. Treasury yield US30YT=RR fell about 9 basis points to 5.195%, after touching its highest level since 2007 on Tuesday. Falling Treasury yields tend to support emerging-market assets by narrowing the relative appeal of safer developed-market debt.
The dollar =USD fell 0.8% to multi-month lows, easing pressure on emerging-market currencies despite continued uncertainty over the Middle East conflict. 
Among currencies, the Colombian peso COP= gained the most, rising 1.5%, while Brazil's real BRL= rose 0.9%. The stronger performance of the Colombian peso relative to the real suggested investors remained wary of Brazil despite the broader improvement in risk sentiment.
"The fact that we're getting the boost in Colombian peso and a bit more even in the real ...tells me that there's still caution on the Brazilian side," said Alejandro Cuadrado, Latin America strategist at BBVA. 
Brazilian equities .BVSP advanced 0.8%, rebounding from nearly a seven-month low in the previous session.
Brazilian assets have been beaten down recently over the central bank's tighter policy stance ahead of the October presidential elections.
"This is more temporary relief for Brazil ... the trend for real into the elections will be for a weaker currency and the risk still for some outflows in the equity space," Cuadrado added.
Brazil's fuel retailer Vibra Energia VBBR3.SA advanced 3.6%. The company highlighted its expansion of higher-margin diesel products for the mining sector, including a premium fuel tested by Vale VALE3.SA that it says improves efficiency and fuel economy.
Mexican stocks .MXX rose 0.3% and were on track to snap a four-day losing streak, while the peso MXN= gained 0.7% to levels not seen since 2024. Bloomberg News reported on Tuesday that Mexico was considering additional trade restrictions on selected Chinese and other foreign products, along with higher import tariffs.
Chilean stocks .SPIPSA rose 0.7%, led by 2.5% gains in miner SQM following a better-than-expected quarterly profit.
Meanwhile, the Federal Reserve's July meeting minutes showed that policymakers were concerned about persistent inflation, with several of them ready to hike interest rates.
     
Key Latin American stock indexes and currencies at 19:06 GMT
Stock indexes
Latest Price
Daily % change
MSCI Emerging Markets .MSCIEF
1672.58
-1.3
MSCI LatAm .MILA00000PUS
2963.14
1.21
Brazil Bovespa .BVSP
167644.28
0.79
Mexico IPC .MXX
64107.05
0.27
Chile IPSA .SPIPSA
11265.29
0.7
Argentina MerVal .MERV
2880892.86
-0.37
Colombia COLCAP .COLCAP
2449.97
-0.46
     
Currencies
Latest
Daily % change
Brazil real BRL=
5.1719
0.89
Mexico peso MXN=
16.9478
0.66
Chile peso CLP=
920.92
0.67
Colombia peso COP=
3049.34
1.52
Peru sol PEN=
3.3629
0.09
Argentina peso (interbank) ARS=RASL
1,497.0
-0.10
Argentina peso (parallel) ARSB=
1,540.0
0.96
     

 (Reporting by Ragini Mathur and Utkarsh Hathi in Bengaluru; Editing by Aurora Ellis and Shinjini Ganguli)
 ((Ragini.Mathur@thomsonreuters.com; utkarshtushar.hathi@thomsonreuters.com))