Bonds News

EMERGING MARKETS-Mexican, Chilean pesos rise as other Latam currencies fall

    * Brazil real falls as Guedes says emergency budget ends
this year
    * Mexico's investment plan viewed as positive by analysts 
    * Chilean peso strengthens after higher copper prices
    * Oil exporter Colombia's peso hit by falling crude prices

 (Updates prices throughout)
    By Shreyashi Sanyal
    Oct 7 (Reuters) - Mexico's peso rose on Wednesday as the
country's newly announced investment push was viewed as positive
for its ailing economy and the Chilean peso gained ground after
copper prices rose, bucking a trend among other Latin American
    The peso jumped 1.1% against the dollar, as investors
were optimistic after the government presented an infrastructure
investment plan worth almost $14 billion (297 billion pesos) on
Monday. The package, which is mostly privately financed, is the
first concrete sign of a renewed readiness by corporate bosses
to invest under President Andres Manuel Lopez Obrador.

    "After the government had so far seemed rather tight-fisted,
referring to the difficult public finances, it is now going to
support the economic recovery with the implementation of
infrastructure projects," said Elisabeth Andreae, FX and
emerging markets analyst at Commerzbank. 
    "As far as the choice of the projects is concerned, 
government and the president seem intent on preventing a
repetition of past mistakes and to regain lost investor
    Mexico's currency has fared better than those of regional
peers in recent months, in part due to the strong economic
connection with the United States, its main trading partner, but
the peso remains exposed to volatility leading up to the Nov. 3
U.S. elections.
    Chile's peso rose 0.5% after copper prices rose on
expectations of improving economic growth and stronger demand
for industrial metals.
    The Chilean central bank data showed a trade balance of $886
million in September, boosted by an 8.3% surge in the value of
copper exports.
    In Brazil, the real fell after Economy
Minister Paulo Guedes said the country has no plans to extend
emergency aid payments to the poor or extend the government's
pandemic-fighting 'war budget' into next year.
    Fears about Brazil's public finances have heightened, with
investors questioning whether President Jair Bolsonaro is
committed to resuming fiscal tightening after a decision well
into the pandemic to pump up spending to fight the disease. 
    Brazilian central bank president Roberto Campos Neto said
economic recovery is only partial, with sectors most affected by
social distancing still "depressed," and also repeated
policymakers' intention not to reduce monetary stimulus.
    Stocks on Wall Street traded higher, even as U.S. President
Donald Trump broke off negotiations with Democrats on more
economic aid on Tuesday.
    Trump's abrupt call to end stimulus talks also hit oil
prices, along with a larger-than-expected rise in U.S. crude
inventories. Crude exporter Colombia's currency fell
against the dollar. 
    Peru's sol strengthened ahead of the central bank's
decision on interest rates, with analysts expecting rates to be
held steady. 
    Key Latin American stock indexes and currencies at 1935 GMT:
            Stock indexes                    Latest   Daily %
 MSCI Emerging Markets                       1108.98     0.59
 MSCI LatAm                                  1856.08    -1.17
 Brazil Bovespa                             96047.09     0.45
 Mexico IPC                                 37389.42      1.2
 Chile IPSA                                  3588.67    -0.91
 Argentina MerVal                           44691.78     0.57
 Colombia COLCAP                             1166.83    -0.18
               Currencies                    Latest   Daily %
 Brazil real                                  5.6162    -0.34
 Mexico peso                                 21.4950     1.05
 Chile peso                                    795.2     0.38
 Colombia peso                               3841.37    -0.26
 Peru sol                                     3.5688     0.39
 Argentina peso (interbank)                  77.1000    -0.03
 Argentina peso (parallel)                       151     0.66

 (Reporting by Shreyashi Sanyal in Bengaluru)