March 7, 2018 / 12:52 AM / 4 months ago

EMERGING MARKETS-Mexican peso weakens after top Trump economic aide resigns

 (Recasts with Cohn resignation, updates prices)
    MEXICO CITY, March 6 (Reuters) - Mexico's peso currency
weakened late on Tuesday after the top economic adviser to U.S.
President Donald Trump announced his decision to step down,
sparking fears that protectionist trade sentiment is gaining
influence in Washington.
    After markets closed, White House Director of the National
Economic Council Gary Cohn, a former Goldman Sachs banker and
free trade advocate, said he planned to resign as Trump showed
no sign of backing away from imposing new tariffs of steel and
aluminum imports. 
    Mexico's peso currency fell more than 0.5 percent after news
of Cohn's resignation was reported.
    The peso has swung wildly over the past year on concerns
that Trump could rip up a free trade agreement with Mexico and
Canada.
    Carlos Vejar, a trade expert who was head counsel negotiator
for Mexico on the original Trans-Pacific Partnership trade deal,
said Cohn's departure removed a moderating influence on
protectionist tendencies inside the White House.
    "However, the main concern for Mexico is NAFTA, not the
steel tariffs," he said.
    Going forward, the main question occupying Mexico would be
who replaces Cohn inside the Trump administration, Vejar added.
    Earlier in the day, most Latin American markets rose as
Trump's plan to slap tariffs on the metal imports faced stiff
opposition from U.S. lawmakers.
    The surprise tariff announcement coincided with the latest
round of talks to update the North American Free Trade Agreement
(NAFTA), and Mexico's top trade official on Tuesday rejected
making a bilateral trade treaty with the United States if the
three-way talks collapse.
    In Ecuador, President Lenin Moreno named a new finance
minister following the unexpected resignation of his top finance
official, as his government prepared to announce a plan to
revive its sluggish economy.
        
    Key Latin American stock indexes and currencies at 2154 GMT:
    
 Stock indexes           Latest    daily % change   YTD % change
                                                   
 MSCI Emerging           1193.93             1.51           3.06
 Markets                                           
 MSCI LatAm              3104.35              0.6           9.77
                                                   
 Brazil Bovespa         85653.02            -0.43          12.11
                                                   
 Mexico IPC             47884.63             0.34          -2.98
                                                   
 Chile IPSA              5548.21             0.17          -0.29
                                                   
 Chile IGPA             27800.45             0.13          -0.64
                                                   
 Argentina MerVal       32864.98             2.28           9.31
                                                   
 Colombia IGBC          11430.15             0.39           0.52
                                                   
 Venezuela IBC           4739.99            10.31         275.25
                                                   
                                                                
 Currencies             Latest     daily % change   YTD % change
                                                   
                                                   
 Brazil real              3.2085             0.04           3.27
                                                   
 Mexico peso             18.7425             0.27           5.10
                                                   
 Chile peso               599.85             0.00           2.47
                                                   
 Colombia peso              2853            -0.05           4.52
                                                   
 Peru sol                   3.25             0.00          -0.40
                                                   
 Argentina peso          20.3100            -0.44          -8.42
 (interbank)                                       
                                                   
 Argentina peso            20.38            -0.49          -5.64
 (parallel)                                        
                                                   
 
 (Reporting by Dave Graham and David Alire Garcia in Mexico City
and Bruno Federowski in Brasilia;
Editing by Nick Zieminski and Diane Craft)
  
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