Bonds News

EMERGING MARKETS-Most Latam currencies up for the week, Brazil leads gains

    * Brazil's real outperforms Latam peers for the week
    * Chilean peso among few weekly decliners in Latam  
    * Argentina central bank to lower Leliq rate, hike repo rate

    By Shreyashi Sanyal
    Oct 9 (Reuters) - Most major currencies in Latin American
were set to end the week higher on Friday, with Brazil's real
leading gains after economic data through the week showed signs
of improvement, while a weaker dollar also offered support. 
    The real strengthened 1.3%, heading for its
first weekly gain in five as data showed a pick-up in Brazil's
services sector last month. Another report showed a record
reading on retail sales for August. 
    Investors, however, worried about Brazil's public finances
after the introduction of a new fiscal bill, called Renda
Cidada, fanned fears about the government overshooting its
spending limit.
    FX analysts at Commerzbank said that given the uncertainty
about the pandemic's progression and its economic impact, it is
unlikely that disagreements about the consolidation of national
finances will be resolved soon.     
    Mexico's peso was on track for its second week of
gains after the country's government unveiled an infrastructure
investment plan worth nearly $14 billion earlier in the week. 
    Latam currencies also got a lift from the dollar,
which fell to three-week lows on Friday as optimism that a deal
for new U.S. stimulus would be reached, and as investors bet
that Democrat Joe Biden is more likely to win the U.S.
presidency and offer a larger economic package.
    Analysts say a Democratic sweep could also bode well for
emerging markets.
    "Biden is a much more risk friendly candidate, given his
international credentials for multilateralism and predictability
and a far less disruptive trade policy," said Alan Ruskin, macro
strategist at Deutsche Bank.
    The Colombian peso also headed for weekly gains,
getting a boost from rising oil prices.
    Chile's peso was among the few losers for the week,
as it tracked lower prices of copper, its main export, for the
    Argentina's peso edged higher. The country's
central bank will lower the benchmark Leliq rate to 37%, from
the previous level of 38%, it said on Thursday, while raising
the passive repo rate 3 points to 27%, part of a wider interest
rate harmonizing push.
    The bank said the repo rate increase and alignment of the
'Leliq' rate with Treasury instruments will boost their
effectiveness in influencing short-term rates.
    Key Latin American stock indexes and currencies at 1450 GMT:
          Stock indexes                  Latest   Daily %
 MSCI Emerging Markets                   1125.36     0.71
 MSCI LatAm                              1933.87      1.7
 Brazil Bovespa                         97524.24     -0.4
 Mexico IPC                             38541.13     0.36
 Chile IPSA                              3656.53     0.17
 Argentina MerVal                       45378.78   -0.227
 Colombia COLCAP                         1186.14    -0.02
             Currencies                  Latest   Daily %
 Brazil real                              5.5180     1.27
 Mexico peso                             21.2002     0.81
 Chile peso                                794.9     0.42
 Colombia peso                           3821.99     0.41
 Peru sol                                 3.5677     0.34
 Argentina peso (interbank)              77.0900     0.05
 Argentina peso (parallel)                   158     0.00

 (Reporting by Shreyashi Sanyal in Bengaluru; Editing by Richard