* Mexican peso falls as much as 2.7%
* Brazil's real hits new low of 4.67 per dollar
* Argentina central bank cuts benchmark rate to 38%
* Colombia's peso touches record low as oil tumbles
(Adds comment, updates prices)
By Shreyashi Sanyal and Susan Mathew
March 6 (Reuters) - Mexico's peso slipped to a one-year low
on Friday on bets of a steeper interest rate cut, while most
other Latin American currencies followed suit as surging
coronavirus cases left daunting prospects for global growth.
A Citibanamex survey sees Bank of Mexico cutting its key
interest rate by 50 basis points at its monetary policy meeting
in late March, 25 basis points more than a forecast two weeks
ago, following the U.S. Federal Reserve's surprise rate cut.
The currency of Latin America's no. 2 economy slid as
much as 2.7% to 20.38 against the dollar.
"With the recent trend in energy prices not really being
supportive, I would expect it (Mexican peso) to be under
pressure in the coming weeks," said Cameron Brandt, director of
research at EPFR in Boston.
In an emergency move, the Fed cut interest rates on Tuesday
to help the U.S. economy combat the fallout from the
fast-spreading virus which has infected more than 100,000 people
globally and caused over 3,400 deaths, forcing suspension of a
worrying amount of economic activity.
"It's complicated to assess if the central bank moves are
the best response because Latam economies have little room to
provide fiscal stimulus," said Wilson Ferrarezi, an analyst with
TS Lombard in Brazil.
Brazil's real slid as much as 1.4% to new lows of
4.67 per dollar, taking no solace from a dollar in the doldrums.
Brazil confirmed its eighth coronavirus case on Thursday,
including the first instances of likely local transmission,
strengthening speculation of a interest rate cut to a record
low.
"The key thing to monitor in Brazil is how the central bank
will gauge the net effect of lower domestic growth given this
complicated external scenario, and the eventual effect of the
weaker currency on Brazilian inflation," said TS Lombard's
Ferrarezi.
"It's hard to make any measurements because rates have never
been so low and the real so weak at the same time."
This is the currency's fourth straight session of marking
fresh all-time lows, putting it on course for a weekly loss of
nearly 4%.
Late on Thursday, Argentina's central bank cut its benchmark
rate to 38% from 40% in its eighth cut since December aimed to
help revive the economy seen as vital to avoid defaulting on its
debts.
OIL SLIDES
Elsewhere in the emerging market universe, the rouble
tumbled after Russia said it will not back an OPEC call for
extra oil output cuts. Moscow-listed stocks sank 3.5%.
That sent oil prices sliding 8%, which pushed crude exporter
Colombia's peso to all-time lows.
Key Latin American stock indexes and currencies at 1919 GMT:
Stock indexes Latest Daily % change
MSCI Emerging Markets 1010.53 -2.77
MSCI LatAm 2284.43 -3.79
Brazil Bovespa 98126.62 -4.02
Mexico IPC 41458.31 -2.09
Chile IPSA 4228.82 -2.2
Argentina MerVal 35458.84 -3.572
Colombia COLCAP 1513.60 -2.14 Currencies Latest Daily % change
Brazil real 4.6300 0.44
Mexico peso 20.1246 -1.39
Chile peso 826.2 -0.36
Colombia peso 3586.11 -1.40
Peru sol 3.4698 -0.32
Argentina peso (interbank) 62.4775 -0.09
(Reporting by Shreyashi Sanyal, Medha Singh and Susan Mathew in
Bengaluru;
Editing by Nick Zieminski and Diane Craft)
Our Standards: The Thomson Reuters Trust Principles.