April 4, 2017 / 5:50 PM / 5 months ago

EMERGING MARKETS-Mexico peso pares losses ahead of intervention

    By Bruno Federowski
    SAO PAULO, April 4 (Reuters) - The Mexican peso pared losses
on Tuesday after the country's central bank announced it would
intervene in the foreign exchange market in an effort to ease
pressure on the currency.
    The Mexican central bank said it would sell up to $200
million worth of currency hedging instruments to roll over
papers set to expire on Wednesday, just ahead of a meeting
between U.S. President Donald Trump and Chinese President Xi
Jinping.
    The bank had originally issued the instruments as a way to
stem the peso's slide following the U.S. election of Trump, who
pledged to scrap trade agreements with Mexico.
    The peso has since rebounded as those concerns eased, with
investors betting that he would not impose big tariffs on
Mexican exports to the United States.
    Still, it remained the biggest decliner among Latin American
currencies, weakening nearly 1 percent following a 10 percent
increase so far this year.
    Most Latin American currencies slipped ahead of Trump's
meeting with Xi, which Trump has said "will be a very difficult
one." He has held out the possibility of using trade as a lever
to secure China's cooperation against North Korea at the
Thursday-Friday meeting.
    Argentina's benchmark stock index rose 0.7 percent,
touching a record high for the sixth straight trading day, after
agency S&P raised the country's sovereign rating by a notch to B
from B-.
        
    Key Latin American stock indexes and currencies at 1715 GMT:
 Stock indexes                    Latest        Daily  YTD pct
                                                  pct   change
                                               change  
 MSCI Emerging Markets                963.58    -0.16    11.93
 MSCI LatAm                         2,661.99     0.17    13.54
 Brazil Bovespa                    65,469.14      0.4     8.70
 Mexico IPC                        49,165.72     0.71     7.72
 Chile IPSA                         4,801.89     0.22    15.67
 Chile IGPA                        24,051.51     0.16    16.00
 Argentina MerVal                  20,713.12     0.73    22.43
 Colombia IGBC                     10,155.24    -0.18     0.27
 Venezuela IBC                     45,739.70     3.99    44.27
                                                              
 Currencies                           Latest    Daily  YTD pct
                                                  pct   change
                                               change  
 Brazil real                          3.1180    -0.16     4.21
 Mexico peso                         18.8355    -0.87    10.13
 Chile peso                            660.4    -0.33     1.56
 Colombia peso                         2,867    -0.06     4.69
 Peru sol                               3.25     0.00     5.05
 Argentina peso (interbank)          15.3550     0.28     3.39
                                                       
 Argentina peso (parallel)             15.88     0.69     5.92
                                                       
 

 (Reporting by Bruno Federowski; Editing by Diane Craft)
  

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