MADRID/WASHINGTON Spanish police on Friday arrested Hugo Carvajal, a former head of Venezuelan military intelligence, who Washington believes has a "treasure trove" of details he is willing to share about Venezuelan President Nicolas Maduro.
MEXICO CITY Mexico's main stock index closed out its worst quarter in over 17 years on Monday, dragged down by doubts about how the new leftist government will manage the economy as well as concerns over global growth and trade.
MEXICO CITY Mexico's central bank is seen hiking its benchmark interest rate by 25 basis points on Thursday, according to a poll published on Monday, on the back of expectations for persistently high inflation and forecasts for the U.S. Federal Reserve to increasing borrowing costs.
MEXICO CITY On his first full day in office, Mexican President Andres Manuel Lopez Obrador defended a plan to end lawlessness with a new national guard, an initiative that risks upsetting some supporters who favor a less militarized approach. | Video
MEXICO CITY Mexico's peso currency gained around 1.3 percent on Sunday in international trading, mostly in Asia, after local media reported there may be a solution for bond-holders tied to the financing of a scrapped airport in the capital.
MEXICO CITY Mexico's banking stocks plummeted on Thursday after a senator from the president-elect's party unexpectedly presented a proposal to stop banks from charging certain commissions, deepening fears about the leftist's economic policy.
By Miguel Gutierrez and Susan Mathew
Oct 19 Latin American currency and stock indices
were on track to log weekly gains for a fifth straight week,
with most currencies firming on Friday, while stock markets
trimmed gains as the rally on Wall Street lost some momentum.
The MSCI emerging markets Latin American currency index
looked set to post a weekly gain of 0.7 percent,
while the stock index was on track for a 1.2
On the day, however, Brazil's stock index gave up most of
its gains as the Nasdaq moved into the red and the S&P
While the dollar weakened against the euro, helping Brazil's
real and the Argentine peso hold on to gains, it
firmed against some other emerging market currencies such as the
Mexican and Chilean pesos, after the latter saw a
surprise interest rate hike by the central bank on Thursday.
The Mexican peso reversed course to hit its lowest in more
than a month. Analysts pinned the weakness on the outlook
downgrade by rating agency Fitch on state-owned petroleum
company, Pemex, as well as uncertainty introduced by the vote on
Mexico City's new airport scheduled for next week.
Incoming president Andres Manuel Lopez Obrador, who says the
new airport has been tainted by corruption and will be more
costly than projected, plans to poll the public from Oct. 25 to
Oct. 28 to decide if the government should finish the airport or
upgrade a military air base to complement the existing hub.
"The issue of the Mexico City airport referendum is starting
to receive a little bit more of attention which introduces a
little bit of uncertainty. So, that might have driven some
underperformance in the peso," said Kenneth Lam, a Latam FX
strategist at Citigroup.
Regarding Fitch's downgrade of Pemex's outlook to 'negative'
from 'stable', the concerns is regarding its future commercial
strategy, said James Salazar, an analyst at CI Banco.
"So its finances should continue to be handled with great
caution so as not to cause additional imbalances that will
increase its debt. In this sense, it is imperative that the new
administration focus on continuing to clean up Pemex's finances
as far as possible to release cash flow," Salazar said.
These issues come amid U.S. President Donald Trump
threatening to close the southern border if Mexico did not move
to halt the entry of migrant into the United State- an issue he
says is more important than the recent trade deal struck with
Canada and Mexico.
Brazil's assets rose as latest polls pointed to a victory
for market-preferred presidential candidate Jair Bolsonaro on
the Oct. 28 runoff against rival Fernando Haddad.
Reports late Thursday of Brazil's central bank Governor Ilan
Goldfajn plans to step down by the year end seemed to have
little impact on the market.
"Investors have a fairly positive view of the potential
Bolsonaro administration, and market has confidence that he will
appoint somebody credible to that job," Citigroup's Lam added.
"At the end of the day, the market is pricing in a Bolsonaro
victory on the 28th and we do think there is additional room for
the real to outperform going into that event," he said.
Earlier this month, newspaper Folia de S. Paulo reported
that Bolsonaro could invite the head of global markets at
Santander Brasil to lead the central bank if
Goldfajn declined to stay.
Key Latin American stock indexes and currencies at 1910 GMT:
Stock indexes Latest daily % YTD %
MSCI Emerging Markets 971.23 0.03 -16.19
MSCI LatAm 2693.55 -0.14 -4.63
Brazil Bovespa 83966.78 0.14 9.90
Mexico IPC 47289.42 0.56 -4.18
Chile IPSA 5119.66 0.01 0.01
Argentina MerVal 28650.44 0.99 -4.71
Colombia IGBC 12440.67 -0.58 9.41
Currencies daily % YTD %
Brazil real 3.7100 0.36 -10.69
Mexico peso 19.2950 -0.76 2.09
Chile peso 680.5 -0.48 -9.68
Colombia peso 3076.05 0.45 -3.06
Peru sol 3.331 0.09 -2.82
Argentina peso (interbank) 36.5200 0.36 -49.07
Argentina peso (parallel) 36.5 2.05 -47.32
(Reporting by Susan Mathew in Bengaluru;
Editing by Marguerita Choy)
By Susan Mathew and Miguel Gutierrez
Oct 4 Soaring U.S. Treasury yields sent Latin
American currencies and stocks sliding on Thursday, mirroring
the declines seen across global financial markets, although a
volatile Brazilian real ended the day flat.
The MSCI Latin American currency index fell
1.5 percent in its steepest plunge in three months as the yield
on the U.S. benchmark 10-year Treasury note was perched at
seven-year highs after robust U.S. economic data.
The stock index was roughly 2 percent lower
with all of the major regional indexes in the red.
The Mexican peso weakened, seeing little impact from
the central bank's widely expected move to keep interest rates
at a 9-1/2-year high of 7.75 percent.
The Banco de Mexico said it would maintain a "prudent"
policy, flagging an upside risk to inflation and a downside risk
"Banxico left the door open to raise the rate in the short
term as it considers that there are still upside risks for
inflation, given an environment of internal and external
uncertainty," CI Banco said in a research note.
However, Alfredo Coutiño, director of analysis for Latin
America at Moody's Analytics, warned that the central bank was
taking a gamble by not raising rates now.
"The central bank is taking an unnecessary risk: the foreign
exchange pressures will worsen in the next few days and affect
the direction of inflation for the rest of the year," he said.
Argentina's peso snapped a three-day winning streak
to finish lower as the allure of the greenback at an 11-month
high swayed capital away from yet another tranche of debt sale
by the central bank.
The bank has sold billions of pesos worth of seven-day
notes, called Leliqs, at sky-high interest rates to mop up
excess liquidity and keep investors from buying dollars – a
tactic that analysts said was unsustainable.
The peso is expected to fall further, a Reuters poll showed,
as skepticism over the government's ability to tame inflation
and plug a budget deficit limit the impact of a deal with the
International Monetary Fund intended to shore up the
recession-riddled country's finances.
The Brazilian real was little changed in a volatile
session, after the latest poll on the country's presidential
race soured hopes of a victory for the market-preferred
candidate, Jair Bolsonaro, in a second-round runoff.
The poll, released late on Wednesday, pointed to a slight
second-round edge for leftist candidate Fernando Haddad, while
previous polls had shown Bolsonaro had clawed ahead.
Key Latin American stock indexes and currencies at 2129 GMT:
Stock indexes Latest Daily pct YTD pct
MSCI Emerging Markets 1,010.38 -2.38 -12.78
MSCI LatAm 2,637.98 -2.13 -6.72
Brazil Bovespa 82,952.81 -0.38 8.57
Mexico IPC 48,683.26 -0.66 -1.36
Chile IPSA 5,326.13 -0.31 -0.31
Argentina MerVal 30,928.83 -3.95 2.87
Colombia IGBC 12,527.43 -0.53 10.17
Currencies Latest Daily pct YTD pct
Brazil real 3.8735 0.55 -14.46
Mexico peso 19.0905 0.03 3.19
Chile peso 675.4 -2.16 -8.99
Colombia peso 3,032.15 0.03 -1.65
Peru sol 3.328 -0.18 -2.73
Argentina peso (interbank) 38.3000 -1.59 -51.44
Argentina peso (parallel) 37.5 2.67 -48.72
(Reporting by Susan Mathew in Bengaluru; Editing by Sandra
By Susan Mathew and Miguel Gutierrez
Oct 3 The Brazilian real rallied on Wednesday,
lifted by election optimism, but the currency gave up a large
chunk its earlier gains while the Mexican peso headed lower as
the dollar rallied after strong U.S. economic data.
The greenback gained as data showed U.S. services sector
activity raced to a 21-year high in September and companies
boosted hiring, signs of enduring strength in the economy at the
end of the third quarter.
Mexico's peso gave up gains of about 0.4 percent
earlier to weaken by more than 1 percent, its worst session in
more than a month, ahead of a central bank meeting on Thursday.
The bank is expected to leave its interest rate unchanged at
7.75 percent as inflation slows and trade uncertainty ebbed
after the United States-Mexico-Canada (USMCA) deal over the
A strengthening dollar, boosted by strong economic data out
of the U.S. kept pressure on the peso, analysts said.
"The momentum of the USMCA has already passed and the peso
has a downward trend looking for a respite that may not be until
next week if the U.S. data continue pointing to a solid
economy," said Alfonso Esparza, senior market analyst at
Brazil's real was 0.9 percent higher, trimming gains
of more than 2 percent earlier. Still, the currency was on track
for a third straight day after a poll showed market-preferred
conservative Jair Bolsonaro would likely beat main rival
Fernando Haddad from the leftist Worker's Party.
Banks drove gains on the Brazilian stock exchange, Bovespa
, with the country's biggest lender Banco do Brasil
rising nearly 4 percent.
Argentina's peso also gained, supported by a surge in sale
of seven-day notes, or leliqs, by the central bank. The bank
sold 109.52 billion pesos ($2.894 billion) worth of leliqs at a
71.267 percent yield, more than what was sold in each of the
past two days.
The peso, also retreated from earlier gains, closing
0.8 percent firmer at 37.74 against the dollar.
Leliq sales are a way of absorbing excess peso liquidity
available so that nervous investors do not turn to safe-haven
buying of the dollar amid soaring inflation.
But, investors remain wary of this mechanism as the high
yields on the notes are unsustainable in the medium term, said
Gustavo Ber, an economist at Estudio Ber.
"This monetary policy is very strong medicine, and while it
has calmed the financial markets, it undermines the prevailing
tax policy and does not strengthen the real economy," Ber said.
A central bank poll had showed the country's inflation and
economic growth worsening from previous expectations by the end
of the year.
Key Latin American stock indexes and currencies at 1937 GMT:
Stock Latest daily % change YTD % change
MSCI Emerging Markets 1030.89 -0.23 -10.8
MSCI LatAm 2662.19 1.23 -7.01
Brazil Bovespa 82928.20 1.61 8.54
Mexico IPC 49044.37 -0.67 -0.63
Chile IPSA 5337.18 0.26 0.26
Argentina MerVal 32418.41 -0.95 7.83
Colombia IGBC 12582.85 0.54 10.66
Currencies Latest daily % change YTD % change
Brazil real 3.8899 1.13 -14.82
Mexico peso 18.9916 -1.04 3.72
Chile peso 660.8 -0.36 -6.98
Colombia peso 3015.35 0.00 -1.11
Peru sol 3.322 -0.30 -2.56
Argentina peso (interbank) 37.6000 1.46 -50.53
Argentina peso (parallel) 38 1.32 -49.39
(Reporting by Susan Mathew in Bengaluru, Miguel Gutierrez in
Mexico City and Walter Bianchi in Buenos Aires; editing by
By Susan Mathew and Miguel Gutierrez
Oct 2 Brazil's real strengthened on Tuesday
after a poll showed the market-preferred presidential candidate
had clawed back ground, while the Mexican peso slipped for the
first time in five days, in line with global risk aversion due
to concerns over Italy.
The real was up 1.5 percent after an opinion poll
showed that a likely presidential election second-round run-off
would result in a tie between Jair Bolsonaro and leftist Workers
Party candidate Fernando Haddad, rather than a loss for
Bolsonaro as investors had feared.
The real is expected to be particularly susceptible to
election news ahead of the first round vote this weekend.
"Apparently the tide seems to have started to turn for
Bolsonaro," Guide brokerage said in a research note. "Many were
starting to forecast that Bolsonaro wasn't going to improve in
the polls ... But yesterday's numbers showed a turnaround."
The benchmark Bovespa index was higher, bolstered by
a 5.4 percent rise in energy company Petrobras as oil
prices hovered near a four-year top.
Brazil was an outlier among emerging markets, which were hit
by a firming dollar and worries about a slowdown in Chinese
manufacturing as well as anti-euro comments by a senior official
of Italy's ruling League party.
The Mexican peso weakened, with analysts saying
relief over the NAFTA deal being salvaged would be replaced by
questions over the new agreement, now called United
"Much of this depreciation of the currency is explained by
the global sentiment of risk aversion due to the issue of Italy
and the technical rebound yesterday," CI Banco said in a note.
On Monday, the peso rallied after the deal was struck, but
pared gains late in the session. Analysts at Banco Base said
investors would remain cautious until they saw details of the
agreement, especially full implications of the parallel letter
or the "insurance" for Mexico in case Washington imposes tariffs
on automotive sector imports.
Argentina's peso rallied for a second day, up 3.6
percent ahead of the central bank's impending sale of another
round of high-yielding short-term debt aimed at easing inflation
by mopping up excess liquidity.
Key Latin American stock indexes and currencies at 1455 GMT:
Stock indexes daily % YTD % change
MSCI Emerging Markets 1032.06 -1.37 -9.67
MSCI LatAm 2620.96 2.21 -9.33
Brazil Bovespa 81150.54 3.21 6.22
Mexico IPC 49570.96 -0.54 0.44
Chile IPSA 5314.34 0.3 0.30
Argentina MerVal 33092.82 1.56 10.07
Colombia IGBC 12457.13 -0.8 9.56
Currencies daily % YTD % change
Brazil real 3.9603 1.45 -16.34
Mexico peso 18.7910 -0.44 4.83
Chile peso 660 -0.30 -6.87
Colombia peso 3000.99 -0.13 -0.63
Peru sol 3.313 -0.18 -2.29
Argentina peso (interbank) 38.1000 3.81 -51.18
Argentina peso (parallel) 38.25 3.92 -49.73
(Reporting by Susan Mathew in Bengaluru and Miguel Gutierrez
and Michael Scott O'Boyle;)