September 7, 2018 / 8:21 PM / 17 days ago

EMERGING MARKETS-Argentine peso rises for 3rd day, gains slightly this week

    By Jorge Otaola
    BUENOS AIRES, Sept 7 (Reuters) - Argentina's peso rose for a
third day running on Friday after the central bank said
government financing for 2019 was secure and that yields on the
country's sovereign debt were too high, bucking pressure on
other currencies in Latin America.
    The peso closed up 1.27 percent after slipping in
morning trade, marking a gain of 0.05 percent this week, also
lifted by optimism about talks between the government and the
International Monetary Fund to shore up Argentina's finances.
    "There is no doubt that there is an over-exaggeration. This
is going to correct itself quicker than markets believe,"
central bank governor Luis Caputo said of the sovereign debt
yields at a conference of finance executives.
Financing for 2019 would be "more than sufficient",
he added.
    The Argentine peso plummeted 16 percent last week after
President Mauricio Macri announced that the country would seek
early disbursements from its stand-by deal with the IMF to
assuage concerns about sustainability of its debt.
    Markets were closed in Brazil for a national holiday a day
after the stabbing of far-right presidential candidate and
front-runner Jair Bolsonaro jolted the country, throwing the
election race into chaos a month before the vote.   
    Several currencies in the region weakened after U.S.
President Donald Trump said on Friday he had tariffs ready to go
on $267 billion worth of imports from China, stirring fears of
escalation in a gathering global trade conflict.
    That threat came on top of $200 billion worth of China's
goods already facing potential duties.
    There was also no breakthrough yet in U.S.-Canada talks to
find common ground in the renegotiation of the North American
Free Trade Agreement (NAFTA), though Canada's foreign minister
said "very good progress" was being made.
    Mexico's peso fell 0.8 percent, Peru's sol
closed down 0.12 percent to its lowest level in 20 months, and
Chile's peso shed 0.26 percent. Colombia's peso,
by contrast, was trading up over 0.8 percent in the afternoon.
    Key Latin American stock indexes and currencies at 1945 GMT:
    
 Stock indexes               Latest           Daily   YTD pct
                                                pct    change
                                             change  
 MSCI Emerging Markets           1,018.29     -0.34     -12.1
                                                     
 MSCI LatAm                      2,410.79      1.29    -14.76
 Mexico IPC                     48,893.32      0.44     -0.85
 Argentina MerVal                29975.00      0.09     -0.30
 Colombia IGBC                  11,996.81      0.03      5.50
 Chile IPSA                      5,221.01      1.00    -6.175
                                                             
 Currencies                        Latest     Daily   YTD pct
                                                pct    change
                                             change  
 Mexico peso                      19.3358     -0.82      1.88
 Chile peso                        690.80     -0.26    -11.02
 Colombia peso                      3,058      0.81     -2.49
 Peru sol                           3.326     -0.12     -2.68
 Argentina peso (interbank)         36.95      1.27    -49.66
                                                     
 
 (Writing by Dave Graham; 
Editing by Sandra Maler)
  
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