EMERGING MARKETS-Latam currencies pressured by U.S. debt concerns
SAO PAULO, Oct 8 (Reuters) - Most Latin American currencies weakened slightly on Tuesday with investors cautious about the ability of U.S. legislators to raise the country's debt ceiling in time to avoid a default. The Mexican peso and the Chilean peso slid 0.2 and 0.3 percent, respectively, as President Barack Obama warned of "insane, catastrophic, and chaotic" consequences should the United States stop honoring its debt obligations. The losses were contained, with the Brazilian real managing to stay in the black, as some investors still believe Republicans and Democrats will eventually reach an agreement to increase the country's debt ceiling before the Treasury runs out of money to keep servicing debt later this month. "The only reasonable explanation for the current calmness of the FX market is the expectation that the problems will be solved in the last minute," analysts at Commerzbank wrote in a research note. The U.S. government has been partly shut down since the beginning of the month as legislators have been unable to agree on a new budget, leading to concerns that they will also fail to raise the nation's debt ceiling in a timely manner. Latin America FX prices at 1915 GMT: Currencies daily % YTD % change change Latest Brazil real 2.2040 0.18 -7.44 Mexico peso 13.1730 -0.23 -2.34 Chile peso 500.1000 -0.28 -4.28 Colombia peso 1890.000 -0.16 -6.56 0 Peru sol 2.7770 0.00 -8.14 Argentina peso 5.8200 0.04 -15.59 Argentina peso 9.6100 -0.62 -29.45
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