Reuters logo
4 months ago
EMERGING MARKETS-Brazil rate futures flat after cenbank cuts rates by 100 bps
April 13, 2017 / 3:16 PM / 4 months ago

EMERGING MARKETS-Brazil rate futures flat after cenbank cuts rates by 100 bps

    By Bruno Federowski
    SAO PAULO, April 13 (Reuters) - Yields on Brazilian interest
rate futures were flat on Thursday after the central bank cut
rates by an expected 100 basis points but refrained from
signaling a steeper reduction ahead.
    In a unanimous vote, the bank agreed on the deepest cut in
nearly eight years, bringing the overnight Selic lending rate to
an almost two-year low of 11.25 percent.
    Despite calls from some politicians and business leaders for
the central bank to be even more aggressive, the policy
statement announcing the decision suggested it would keep the
current pace of cuts for now.
    JPMorgan economists wrote in a note to clients: "At the
current juncture, we keep our call for another 100bp cut at the
May meeting, followed by one cut of 75 basis points in July and
a final 50 basis-point cut in September."
    Rate future yields indicated an 80 percent probability of a
100 basis-point cut in May, with a 20 percent chance of a 125
basis point reduction, traders said.
    The Brazilian real firmed 0.4 percent, tracking other
Latin American currencies higher after U.S. President Donald
Trump said that the U.S. dollar was getting too strong and he
would prefer the Federal Reserve to keep interest rates low.

    Brazil's benchmark Bovespa stock index, however, was
nearly flat.
    Shares of planemaker Embraer SA fell 2.6 percent,
leading losses on the index, after disappointing first-quarter
delivery figures. Analysts at Morgan Stanley Securities cut the
price target on U.S.-listed Embraer shares to $23 from
$27.
   
    Key Latin American stock indexes and currencies at 1500 GMT:
 Stock indexes                                daily %   YTD %
                                     Latest    change  change
 MSCI Emerging Markets                963.86     0.59   11.13
 MSCI LatAm                          2633.66     0.87   11.54
 Brazil Bovespa                     63920.55     0.05    6.13
 Mexico IPC                         48955.82    -1.37    7.26
 Chile IPSA                          4863.18    -0.02   17.15
 Chile IGPA                         24373.17    -0.01   17.55
 Argentina MerVal                   20812.17    -0.86   23.02
 Colombia IGBC                      10250.56     0.22    1.21
 Venezuela IBC                      47030.02     0.47   48.34
                                                             
 Currencies                                   daily %   YTD %
                                               change  change
                                      Latest           
 Brazil real                          3.1195     0.41    4.16
 Mexico peso                         18.5175     0.15   12.02
                                                       
 Chile peso                            648.4     0.48    3.44
 Colombia peso                       2869.25    -0.07    4.61
 Peru sol                              3.254     0.00    4.92
 Argentina peso (interbank)          15.1700     0.66    4.65
                                                       
 Argentina peso (parallel)             15.64     0.32    7.54
                                                       
 

 (Reporting by Bruno Federowski; Editing by Dan Grebler)
  

0 : 0
  • narrow-browser-and-phone
  • medium-browser-and-portrait-tablet
  • landscape-tablet
  • medium-wide-browser
  • wide-browser-and-larger
  • medium-browser-and-landscape-tablet
  • medium-wide-browser-and-larger
  • above-phone
  • portrait-tablet-and-above
  • above-portrait-tablet
  • landscape-tablet-and-above
  • landscape-tablet-and-medium-wide-browser
  • portrait-tablet-and-below
  • landscape-tablet-and-below