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Bonds News

EMERGING MARKETS-Latam stocks, FX edge higher on virus treatment hopes

    * Mexican rates to fall more than most expect -analysts
    * Brazil' real up 0.1%; Chile's peso jumps 1.3%
    * Brazil to delay announcement of new economic package
    * Colombia investment grade loss likely -Fitch

 (Updates prices throughout)
    By Susan Mathew and Shreyashi Sanyal
    Aug 24 (Reuters) - Latin American currencies and stocks
edged higher on Monday, on higher commodity prices and optimism
over coronavirus treatments, while Brazil's real pared gains on
a delay in a new economic package.
    Global sentiment got a lift after the U.S. Food and Drug
Administration approved the use of blood plasma from recovered
COVID-19 patients as a treatment option. A Financial Times
report said the U.S. government was considering fast-tracking
AstraZeneca's experimental vaccine.
    Main stock indexes in Latin America rose between 0.1% and
0.6%. Argentina's Merval lost 1.7%.  
    Eyes will also be on Federal Reserve Chair Jerome Powell's
address on Thursday about the U.S. central bank's monetary
policy framework review.
    Brazil's real rose 0.1% from three-month lows, but
investors turned cautious after the Brazilian government's move
to delay the announcement of a series of measures aimed at
propping up the economy, originally due to be revealed on
Tuesday.
    The World Health Organization said on Friday the coronavirus
crisis appears to be leveling off, if not easing, in Brazil, the
world's second biggest COVID-19 hot spot, with more than 3.6
million cases registered as of Sunday. 
   
    The real has been facing increased pressure from a slew of
ministerial resignations and worries about the country's fiscal
position.
    Mexico's peso gave up early gains to drop 0.2%.
Annual inflation in the first half of August increased to 3.99%,
above expectations, to the upper end of the central bank's
target range.
    The data "will probably prompt the central bank to slow the
pace of its easing cycle. But with inflation set to drop back
over the coming months, we still think interest rates will fall
by more than most expect this year," Capital Economics wrote in
a note.
    Chile's currency led gains in the region, up 1%, as
copper prices rose, while the Colombian peso fell 0.5%.

    Credit rating agency Fitch said it expected Colombia's
economy to contract almost 7% in 2020 because of the coronavirus
pandemic, adding the Andean country was likely to lose its
investment grade.
    In Argentina, approval by creditors of its debt
restructuring offer is being eyed ahead of a Friday deadline.
Investors are now looking for macroeconomic reforms and
International Monetary Fund support to regain confidence.
 
    
    Key Latin American stock indexes and currencies at 1930 GMT:
    
           Stock indexes                    Latest   Daily %
                                                     change
 MSCI Emerging Markets                      1108.26      1.5
 MSCI LatAm                                 1962.40     0.53
 Brazil Bovespa                           102011.94     0.48
 Mexico IPC                                38062.47    -0.09
 Chile IPSA                                 3965.48    -0.73
 Argentina MerVal                          46626.94   -1.654
 Colombia COLCAP                            1206.07     1.67
                                                            
               Currencies                   Latest   Daily %
                                                     change
 Brazil real                                 5.5992     0.11
 Mexico peso                                22.0220    -0.28
 Chile peso                                   783.2     1.32
 Colombia peso                              3853.44    -0.52
 Peru sol                                    3.5847    -0.06
 Argentina peso (interbank)                 73.7200    -0.19
                                                     
 Argentina peso (parallel)                      134     2.99
                                                     
 
 

 (Reporting by Susan Mathew and Shreyashi Sanyal in Bengaluru
Editing by Paul Simao and Richard Chang)
  
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