EMERGING MARKETS-Chile peso at new low on slow mining data, unrest; other Latam FX drop too

  • Reuters
  • Stock Market News
EMERGING MARKETS-Chile peso at new low on slow mining data, unrest; other Latam FX drop too

By Susan Mathew

Oct 30 (Reuters) - Chile's peso slumped on Wednesday to an all-time low amid poor mining data and domestic unrest, while other Latin American currencies slipped as investors braced for interest rate decisions from the United States and Brazil.

Chile's peso CLP= slid 1.5% to 737.53 to the dollar, an all-time low and stocks tumbled 3.1% to a eight-week trough. The country's manufacturing production dropped in September from a year ago amid a decrease in mining production, government data showed. worry about deteriorating economic activity in Chile - the world's biggest producer of copper as a recent political crisis has seen union workers at BHP's Escondida copper miner go on strike. Sebastian Pinera said Chile will suspend hosting the Asia Pacific summit next month. The United States and China were expected to sign a partial trade agreement at the summit, but Reuters reported U.S. officials warning the deal may not be ready by then. had hit sentiment globally. On Wednesday, Wall Street traded flat, while most Latam shares slipped. MKTS/GLOB

The dollar remained steady as investors expected the Federal Reserve to cut U.S. interest rates for the third time this year and awaited comments by the Fed Chair Jerome Powell. The decision is due at 2 p.m. ET. FRX/

"We look for the Fed to temporarily pause before resuming rate cuts in the first quarter of 2020," said Ned Rumpeltin, European head of FX strategy at TD Securities.

A more patient Fed would strengthen the dollar, he said, keeping emerging market currencies under pressure.

In Brazil, the central bank is expected to slash the key rate by 50 basis points, also for the third time this year. The real BRL= slipped 0.7%, headed for its biggest daily drop in two-weeks. further rate cut in December is... no fait accompli," said You-Na Park-Heger, an FX and EM analyst with Commerzbank (DE: CBKG ), in a note.

"Real interest rates have now reached historic lows and only offer limited scope for periods of increased risk perception on the financial markets," she said.

Brazil's decision is due at 1800 GMT.

Data from Mexico showed the economy grew by 0.1 percent in the third quarter from the previous three-month period, short of market expectations. The peso MXN= slipped 0.2%, headed for its third daily decline.

Brazil's bovespa stock index .BVSP fell 0.7% with card processor Cielo SA CIEL3.SA down after poor quarterly results while the Brazilian unit of lender Santander SANB11.SA fell despite beating estimates on results as its Spanish parent SAN.MC posted a 75% decline in third-quarter profit. other earnings, Colombia's state-run oil company Ecopetrol's ECO.CN third quarter net profit rose 8.5% from the year-ago. The stock was down 0.16%. Latin American stock indexes and currencies at 1441 GMT:

Stock indexes

Latest

Daily %

change MSCI Emerging Markets .MSCIEF

1038.97

-0.46 MSCI LatAm .MILA00000PUS

2771.82

-1.39 Brazil Bovespa

.BVSP

106951.21

-0.56 Mexico IPC

.MXX

43773.04

-0.18 Chile IPSA

.SPIPSA

4729.64

-3.1 Argentina MerVal

.MERV

32547.07

0.009 Colombia IGBC

.IGBC

13249.82

-0.22

Currencies

Latest

Daily %

change Brazil real

BRBY

4.0262

-0.59 Mexico peso

MXN=D2

19.1747

-0.31 Chile peso

CLP=CL

737.3

-1.37 Colombia peso COP=

3386.98

-0.41 Peru sol

PEN=PE

3.3508

-0.44 Argentina peso (interbank)

59.4000

0.10 ARS=RASL

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