June 28, 2019 / 2:19 PM / 2 months ago

EMERGING MARKETS-G20 nerves suppress gains in Latam currencies

    June 28 (Reuters) - Most Latin American currencies edged
lower on Friday, as anxious investors awaited the outcome of a
high-stake meeting between the U.S. and Chinese leaders over
their trade dispute that has roiled financial markets for
months.
    U.S. President Donald Trump said on Friday he hoped for
productive talks with Chinese President Xi Jinping, set to be
held at the sidelines of a Group of 20 (G20) summit in Osaka,
but said he had not made any promises about a reprieve from
escalating tariffs.
    While most traders do not see both sides striking a trade
deal, Trump is expected to refrain from imposing new tariffs on
Chinese goods.
    "The broad consensus is that they will agree to resume talks
and at best, the U.S. will pledge to hold off from imposing
remaining sanctions for now," RBC's global head of FX Strategy,
Elsa Lignos, wrote in a note.
    The Brazilian real was down about 0.3%, giving back
some of its gains made on Thursday after the government's
special congressional pension coordinator Samuel Moreira said
there was  still time to vote on pension reform in June, even
after a committee meeting was canceled on Thursday.
    However, Sao Paulo-listed shares gained as the
state-run oil firm Petroleo Brasileiro SA
jumped more than 1%.
    Petrobras, which is selling tens of billions of dollars of
assets to cut debt, will leave the gas distribution business in
Brazil, its Chief Executive Roberto Castello Branco said on
Thursday, adding the company was expecting to receive binding
offers for its liquefied petroleum gas (LPG) distribution unit
as soon as August.
    Other currencies in the region stayed largely flat, with the
Mexican peso holding steady after the Bank of Mexico kept
rates unchanged on Thursday, as expected.
    President Andres Manuel Lopez Obrador said on Thursday that
Mexico's state oil company Pemex           signed an $8 billion
syndicated loan with more than 20 banks to renew credit lines
and refinance liabilities. 
    The peso has been hit by recent credit downgrades for the
indebted firm.
    
    Latin American stock indexes and currencies at 1355 GMT
    
 Stock indexes                       daily %
                            Latest    change
 MSCI Emerging Markets      1055.27     0.04
                                     
 MSCI LatAm                 2849.55      0.8
                                     
 Brazil Bovespa           101202.56     0.48
                                     
 Mexico IPC                43297.13    -0.04
                                     
 Chile IPSA                       -        -
                                     
 Argentina MerVal                -         -
                                     
 Colombia IGBC             12597.52    -0.03
                                     
                                            
 Currencies                          daily %
                                      change
                             Latest  
 Brazil real                 3.8327    -0.36
                                     
 Mexico peso                19.1580     0.08
                                     
 Chile peso                  679.35    -0.01
                                     
 Colombia peso              3194.73     0.04
                                     
 Peru sol                         -        -
                                     
 Argentina peso                   -        -
 (interbank)                         
                                     
 

 (Reporting by Sruthi Shankar in Bengaluru, Editing by Nick
Zieminski)
  
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