SAO PAULO, April 17 The Brazilian real jumped on
Monday as the central bank stepped up intervention, providing
additional support for the currency amid rising geopolitical
frictions abroad and political concerns at home.
The real firmed 1.4 percent to the strongest in
nearly two weeks after the central bank sold $800 million worth
of currency swaps, which function like dollar sales to investors
for future delivery, to roll over contracts expiring next month.
Should the bank maintain that pace of sales daily until the
end of the month, it will fully roll over $6.4 billion worth of
swaps set to mature on March 2. The central bank currently holds
around $17.7 billion worth of swaps on its balance sheet.
The move comes as escalating frictions between the United
States and North Korea depressed investor appetite for
high-yielding, emerging market assets.
U.S. Vice President Mike Pence warned on Monday that recent
U.S. military strikes in Syria and Afghanistan show that the
resolve of President Donald Trump should not be tested, a day
after a failed missile test by North Korea.
Demand for the Brazilian currency also wavered in recent
days due to uncertainty over the approval of a planned pension
reform following corruption investigations against senior
members of President Michel Temer's administration.
Other Latin American currencies seesawed on Monday as
investors remained weary of the geopolitical tensions. The
Mexican peso slipped from a five-month peak, but the
Chilean peso followed copper prices higher.
Key Latin American stock indexes and currencies at 1530 GMT:
Stock indexes daily % YTD %
MSCI Emerging Markets 962.33 0.2 11.38
MSCI LatAm 2638.96 1.28 11.32
Brazil Bovespa 63817.50 1.58 5.96
Mexico IPC 49066.69 0.23 7.50
Chile IPSA 4853.60 -0.1 16.92
Chile IGPA 24343.38 -0.07 17.41
Argentina MerVal 20753.58 -0.28 22.67
Colombia IGBC 10162.69 -0.86 0.34
Venezuela IBC 47196.37 0.35 48.86
Currencies daily % YTD %
Brazil real 3.1023 1.39 4.74
Mexico peso 18.5600 -0.34 11.77
Chile peso 646 0.64 3.82
Colombia peso 2852.57 0.44 5.22
Peru sol 3.25 0.12 5.05
Argentina peso (interbank) 15.2300 -0.26 4.24
Argentina peso (parallel) 15.76 -0.44 6.73
(Reporting by Bruno Federowski; Editing by Dan Grebler)