RIO DE JANEIRO: Latin American currencies extended their recent slide on Tuesday on lingering concern about falling Chinese demand for the region's commodities exports, but stock indexes steadied after a recent sell-off.
Chile's peso led losses among regional currencies, falling 0.8 percent to its weakest in nearly five years, after prices of copper, the country's main export, tumbled to three-year lows.
The Brazilian real closed 0.6 percent weaker in its fourth straight session of losses, even as the central bank provided investors with protection against a weaker exchange rate by selling currency swaps.
"With iron ore prices falling, it will be much harder for the Brazilian real to 'graduate' from the Fragile Five basket by showing good trade numbers," Citi strategist Kenneth Lam wrote in a note to clients. He referred to the currencies of Brazil, India, Indonesia, Turkey and South Africa, which Morgan Stanley said are poised to underperform due to their countries' current account deficits.
The Mexican peso lost 0.4 percent in its third straight session of declines.
Latin American stocks halted a two-day sell-off, however, with the MSCI benchmark index for the region little changed, near its lowest since Feb. 6.
Brazil's Bovespa stock index edged 0.4 percent higher, although shares of mining and steel companies continued their decline as prices of iron ore fell to 17-month lows.
Preferred shares of Vale SA, the world's largest iron ore producer, fell 1 percent to 26.10 reais, an eight-month low. Companhia Siderurgica Nacional, Brazil's No. 3 steelmaker and No. 2 iron ore producer, fell 2.3 percent to 8.65 reais.
Supporting gains in the Bovespa index were shares of bank Ita? Unibanco and those of state-run oil firm Petrobras.
Petrobras gained 0.8 percent and recovered part of the losses it recorded on the previous day, when it sold $8.5 billion in global notes.
Comments
Comments are closed for this article.