January 23, 2019 / 10:13 PM / 9 months ago

EMERGING MARKETS-Brazil shares hit record high; weak dlr helps Mexico, Chile FX

 (Recasts throughout, updates prices)
    By Susan Mathew and Paula Laier
    Jan 23 (Reuters) - Brazil stocks scaled an all-time high on
Wednesday and the currency firmed, boosted by the country's
economy minister reiterating that much needed pension reforms
remained the government's top priority, while a weaker dollar
helped some other Latin American currencies rise. 
    Uncertainties over trade and the global economy weighed on
the greenback, helping the Mexican and Chilean pesos
    In Brazil, the real rose 1.3 percent and posted its
biggest one-day gain in three weeks, while the benchmark Bovespa
index scaled new highs with gains being broad-based.
    Brazil's economy minister Paulo Guedes told Bloomberg TV
that pension reforms are the government's top priority and that
more than half of the fiscal deficit will be cut with the
reform. He also said that intended privatizations should
generate at least $20 billion in 2019.
    "Guedes once again enchanted the market," said an analyst at
a brokerage in São Paulo.
    Guedes was to participate in a press conference along with
the Brazilian delegation at the World Economic Forum but the
talk was canceled, with representatives of the government citing
President Jair Bolsonaro's fatigue.
    But, meetings between Guedes and some foreign investors on
Tuesday may have been enough to get the message out about
reforms and explain the theme of investor reforms, said Fernanda
Consorte, an FX strategist at Banco Ourinvest. 
    Elsewhere in the region, copper exporter Chile's peso was
bolstered by a rise in the metal's prices, while a drop in oil
prices hurt net crude exporter Colombia's currency. 

    Mexico's peso broke a four-day losing streak and rose 0.7
percent. A Citibanamex survey showed that participants remain
divided on the interest rate movement they expect from the next
Bank on Mexico meeting.
    But, "it is worth noting that none of the participants
expect a rise in interest rates at the central bank's February
meeting and on average they anticipate closing the year at the
same level as in 2018," analysts at CI Banco said in a note. 
    "This forecast is very much in line with the expectation of
low inflation for January, despite the shortage of gasoline." 
    The perception on the central bank's monetary policy stance,
however, may change if the inflation figure for the first half
of January exceeds what is expected, they said. 
    Among stocks, Argentine shares jumped 2.3 percent
while Chilean equities edged higher.    
    On the other hand, the Mexican and Colombian
bourses fell reflecting muted global sentiment on worries about
a continued partial shutdown of the U.S. government, a cooling
global economy and simmering trade tensions between the world's
two biggest economies.
    Key Latin American stock indexes and currencies at 2147 GMT:
    Stock indexes             Latest    Daily %
 MSCI Emerging Markets         1011.56      0.09
 MSCI LatAm                    2834.58      0.52
 Brazil Bovespa               96558.42      1.53
 Mexico IPC                   43679.67      -0.2
 Chile IPSA                    5402.74      0.03
 Argentina MerVal             34819.13      2.28
 Colombia IGBC                11661.25     -0.35
       Currencies             Latest    Daily %
 Brazil real                    3.7640     -0.05
 Mexico peso                   19.0286      0.73
 Chile peso                     671.55      0.27
 Colombia peso                 3151.15     -0.24
 Peru sol                         3.34     -0.18
 Argentina peso                37.5500     -0.03

 (Reporting by Susan Mathew in Bengaluru and Paula Arend Laier
in Sao Paulo; Editing by Lisa Shumaker)
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