EMERGING MARKETS-Chilean peso weakens with copper prices, stronger dollar

    * Erdogan says he will keep battling interest rates, lira
    * Chile's peso leads declines among Latin American
    * Brazil government cuts GDP forecasts, raises inflation

    By Shreyashi Sanyal
    Nov 17 (Reuters) - The Chilean peso weakened on Wednesday as
a dollar rally slammed prices of copper after solid retail sales
data from the United States spurred bets of a
sooner-than-expected interest rate hike there.  
    The MSCI's broader EM index struggled for
direction as the dollar continued to strengthen.
    A 1% fall in Chile's peso led losses among Latin
American currencies, dropping for the second straight session
after prices for its No.1 export, copper, fell.
    In political news, Chile's Senate voted against removing
President Sebastian Pinera from office on Tuesday, ending an
impeachment process that had successfully passed a lower house
vote last week over alleged irregularities in the sale of a
mining company.
    Chileans are now gearing up to vote in presidential
elections on Sunday, in which Pinera is not a candidate.
    "Chile's peso has suffered, not only at the hands of
politics but also from the decision to allow residents to tap
their private pension pots - selling $50 billion worth of
assets," said  Chris Turner, global head of markets and regional
head of research for UK & CEE at ING.
    Most Latin American currencies were trading in a narrow
range after sharp declines in the previous session, with the
MSCI's index for Latam FX edging 0.2% higher. 
    Brazil's real was 0.1% lower in early trading,
after the country's economy ministry cut its forecasts for GDP
growth this and next year, while it raised its outlook for
inflation, showing some economic deterioration on its radar.

    Colombia's peso weakened 0.2%, down for the sixth
straight session even as data from the previous day showed its
economy grew 13.2% in the third quarter of 2021 compared with
the year-earlier period, higher than analysts expectations.

    "We expect this strong momentum to continue in the Q4, but
should moderate into 2022 both on the public expenditure side as
COVID-19 programs and vaccination drives wane, and on the
private side as consumer confidence curbs tied to electoral
uncertainty," Citi analysts wrote in a client note. 
    Turkey's lira led declines among emerging market currencies
after President Tayyip Erdogan upped the pressure on the central
    The lira fell 2.8% to touch new record lows against a
stronger dollar as Erdogan said he will continue his battle
against interest rates "to the end", a day ahead of a central
bank policy meeting at which it is expected to cut again.

    Erdogan has had influence over monetary policy in the past,
with his frequent calls for stimulus and his rapid overhaul of
the central bank's leadership.             
    Key Latin American stock indexes and currencies at 1512 GMT:
       Stock indexes                Latest    Daily %
 MSCI Emerging Markets               1287.87    -0.21
 MSCI LatAm                          2126.53    -0.18
 Brazil Bovespa                    103837.63    -0.54
 Mexico IPC                         50987.96    -0.34
 Chile IPSA                          4304.57    -0.01
 Argentina MerVal                   88973.73   -0.781
 Colombia COLCAP                     1336.55     0.23 Currencies               Latest    Daily %
 Brazil real                          5.5014    -0.04
 Mexico peso                         20.6993     0.11
 Chile peso                            822.5    -1.37
 Colombia peso                       3903.28    -0.28
 Peru sol                             4.0004    -0.37
 Argentina peso (interbank)         100.3400    -0.03
 Argentina peso (parallel)             197.5     1.52


 (Reporting by Shreyashi Sanyal and Susan Mathew in Bengaluru
Editing by Alistair Bell)


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