November 14, 2018 / 4:13 PM / a month ago

EMERGING MARKETS-Latam currencies gain, set to snap six-session losing run

 (Recasts, updates prices, adds quote)
    By Aaron Saldanha and Susan Mathew
    Nov 14 (Reuters) - Latin American currencies were on track
to snap a six-session losing run on Wednesday, with the dollar
tepid after the release of U.S. consumer inflation data.
    Mexico's peso and stocks managed to gain some
ground, midway through what has been a brutal week for them,
while the dollar remained soft as data showed U.S. consumer
prices grew in line with forecasts in October.
    Sacha Tihanyi, deputy head of emerging markets strategy at
TD Securities, said the dollar would likely have been firmer had
the U.S. data beat expectations soundly, as it would have fueled
rate hike expectations by the U.S. Federal Reserve.
    MSCI's index of currencies in Latin America
was up 0.6 percent, with Mexico's peso firming 0.8
percent to regain some of the 1.8 percent it lost across the
previous two sessions.
    MSCI's index of equities in Latin America
was up 0.7 percent, also on track to snap a six-session losing
run.
    The regional stock index was buoyed by strong gains in
Mexico, where a 0.9 percent gain for the benchmark was led by a
2.9 percent rise in cement firm CEMEX, S.A.B. de C.V.
. 
    Analysts broadly expect Mexico's central bank to raise its
benchmark rate by 25 basis points on Thursday, following recent
volatility in local markets and forecasts of a weaker peso.   

    Brazil's Bovespa stock index was up 0.2 percent, led
higher by the consumer staples and financials sectors.
    Food firm JBS SA and mall operator BR Malls
Participacoes rose more than 4.2 percent each after
both posted better-than-expected third-quarter results.

    The real firmed about 0.4 percent. President-elect
Jair Bolsonaro said "bitter" austerity measures are needed to
keep Brazil from becoming "another Greece."

    Many economists say cuts to Brazil's social security system
are essential to controlling a huge federal deficit and
regaining Brazil's investment-grade rating.
    Investors snapped up Brazilian assets in the run up to and
in the wake of right wing Bolsonaro's election victory last
month, on hopes he could make quick advances on fiscal reforms. 
  
    In broader Latin America, Chile's peso firmed 1.1
percent, on track to break a four-day losing streak.       

    Key Latin American stock indexes and currencies at 1552 GMT
    
 Stock indexes                           daily %     YTD %
                             Latest       change    change
 MSCI Emerging Markets          967.80      0.18    -16.61
                                                  
 MSCI LatAm                    2565.60      0.44     -9.68
                                                  
 Brazil Bovespa               85075.79      0.19     11.35
                                                  
 Mexico IPC                   42797.13      0.89    -13.29
                                                  
 Chile IPSA                    5131.76      0.03      0.03
                                                  
 Argentina MerVal             28543.43         0     -5.06
                                                  
 Colombia IGBC                12176.63      0.77      7.09
                                                  
                                                          
 Currencies                              daily %     YTD %
                                          change    change
                                Latest            
 Brazil real                    3.7888      1.07    -12.55
                                                  
 Mexico peso                   20.3414      0.71     -3.16
                                                  
 Chile peso                      684.2      1.14    -10.17
                                                  
 Colombia peso                 3184.78      0.04     -6.37
 Peru sol                        3.376      0.09     -4.12
                                                  
 Argentina peso                36.0600     -0.06    -48.42
 (interbank)                                      
                                                  
 

 (Reporting by Aaron Saldanha and Susan Mathew in Bengaluru;
Editing by Dan Grebler)
  
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