Reuters logo
EMERGING MARKETS-Mexico peso weakens as Trump casts doubt on NAFTA future
August 23, 2017 / 4:27 PM / 3 months ago

EMERGING MARKETS-Mexico peso weakens as Trump casts doubt on NAFTA future

    By Bruno Federowski
    SAO PAULO, Aug 23 (Reuters) - The Mexican peso weakened on
Wednesday after U.S. President Donald Trump cast doubt on the
future of the North American Free Trade Agreement, reigniting
fears of a regional trade war.
    Trump warned he might terminate the NAFTA pact with Mexico
and Canada after three-way talks failed to bridge deep
differences. The first round of negotiations ended on Sunday
with little sign of any breakthrough coming.
    Trump's remarks put investors on alert after months of
optimism over the trade talks, which had helped make the Mexican
peso one of the world's best-performing currencies.
    "A deal remains our base case but the peso may lag with
rising uncertainty, after a period where Trump fear has been
almost fully priced out by the markets," Citigroup strategists
wrote in a note to clients.
    The peso weakened as much as 1 percent on Tuesday before
paring losses to around 0.3 percent. It is still up 17 percent
this year.
    Brazil's benchmark Bovespa stock index rose
slightly, extending the previous day's gains after breaching the
70,000 milestone for the first time since January 2011. The
Brazilian real strengthened nearly 1 percent.
    Shares of Centrais Elétricas Brasileiras SA,
however, fell 7 percent as traders booked profits from a 50
percent jump on Tuesday. A government proposal to privatize
Eletrobras, as the power utility is known, fueled hopes of lower
debts and higher efficiency at the firm, triggering a
market-wide rally.
    
    Key Latin American stock indexes and currencies at 1720 GMT:
 Stock indexes                                daily %    YTD %
                                               change   change
                                   Latest              
 MSCI Emerging Markets               1075.61     0.29    24.38
 MSCI LatAm                          2858.91     0.08    22.05
 Brazil Bovespa                     70363.59      0.5    16.83
 Mexico S&P/BVM IPC                 51190.40    -0.28    12.15
 Chile IPSA                          5112.43    -0.04    23.15
 Chile IGPA                         25552.27    -0.05    23.24
 Argentina MerVal                   23171.08     1.18    36.96
 Colombia IGBC                      10939.66    -0.18     8.01
 Venezuela IBC                     199408.72      0.7   528.95
                                                              
 Currencies                                   daily %    YTD %
                                               change   change
                                      Latest           
 Brazil real                          3.1494     0.92     3.17
 Mexico peso                         17.7050    -0.22    17.16
 Chile peso                            640.8    -0.01     4.67
 Colombia peso                       2984.17    -0.01     0.58
 Peru sol                              3.237     0.03     5.47
 Argentina peso (interbank)          17.2400    -0.15    -7.92
                                                       
 Argentina peso (parallel)              18.2     0.66    -7.58
                                                       
 
 (Reporting By Tom Brown)
  

Our Standards:The Thomson Reuters Trust Principles.
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