(New throughout, updates prices, market activity and comments) By Sagarika Jaisinghani and Susan Mathew Sept 28 (Reuters) - The Chilean peso rose on Monday as President Sebastian Pinera launched a $2 billion fiscal aid program, while the Brazilian real tumbled 1% to extend a three-week losing streak. Chile's peso firmed 0.4% against a weaker dollar a day after Pinera said the subsidies would be aimed at creating new jobs or recovering those lost during coronavirus-driven lockdowns. The currency has recovered sharply from its March lows, but remains about 4% down on the year as the pandemic hammered Chile's commerce, services and tourism sectors and drove unemployment to over 13%, its highest in a decade. The peso has far outperformed Brazil's real, which plumbed new lows in 2020 despite a constitutional reform bill aimed at simplifying and reducing the cost of the public sector of Latin America's biggest economy. The real fell 1.5% on Monday. Analysts at JPMorgan said the currency could outperform its peers "even if (constitutional reform) approvals take longer than some expect." "That said, the recent sell-off in risky assets amid increasing volatility and the fact that BRL is a high beta to these sort of events makes us wary and we stay neutral for the time being," said JPMorgan strategist Saad Siddiqui. The Mexican peso slipped 0.4% even as the unemployment rate eased to 5.2% in August from 5.4% in July. Last week, the central bank lowered interest rates for the 11th time since August 2019. "August data will start to make more apparent that the pace of economic recovery will be slow," said Alonso Cervera, managing director of emerging markets economics research at Credit Suisse. "We will be watchful of imports' performance as we project domestic consumption and investment will take longer to improve than external demand." As oil prices rose, crude exporter Colombia's peso firmed 0.4% after its biggest weekly decline since mid-June. The Argentine peso closed down 0.3% at a record low of 76.06 per dollar with companies struggling to keep up with payments on dollar debt, hiking the risk of corporate defaults after the central bank tightened access to foreign currency to stem a sharp decline in reserves. Buenos Aires' main stock index was up 0.1%, on course to gain for a fifth straight session. Most other Latam bourses rose, with Mexican shares hitting four-week highs. Brazil's Bovespa index, however, hit a near three-month low on broad based losses led by consumer stocks. Latin American stock indexes and currencies 1932 GMT: Stock indexes Latest Daily % change MSCI Emerging Markets 1070.60 1.09 MSCI LatAm 1824.97 -1.43 Brazil Bovespa 95320.25 -1.73 Mexico IPC 37270.96 1.88 Chile IPSA 3594.65 0.16 Argentina MerVal 42101.57 0.141 Colombia COLCAP 1185.59 1.22 Currencies Latest Daily % change Brazil real 5.6399 -1.54 Mexico peso 22.4410 -0.45 Chile peso 784.2 0.36 Colombia peso 3871.25 0.36 Peru sol 3.5887 -0.08 Argentina peso 76.0500 -0.26 (interbank) (Reporting by Sagarika Jaisinghani in Bengaluru; additional reporting by Luana Maria Benedito; editing by Grant McCool and David Gregorio)
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