EMERGING MARKETS – Mexican peso rises after retail sales data, Banxico minutes

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Band Bansari Mayur Kamdar and Anisha Sircar

May 26 (Reuters)Latin American currencies rose on Thursday, with the Mexican peso strengthening for a third day after upbeat retail sales data, even as central bank meeting minutes highlighted still-high inflation.

The peso MXN= gained 0.3% after data showed retail sales in Mexico rose 0.4% in March from February and 3.8% compared to the previous year.

“The strength of the Mexican peso is tied to this streak of positive activity data lately and really adds to the story that the Mexican economy has started 2022 more positively than anyone anticipated, despite the Banxico tightening cycle and Fed risks continuing to build,” said TS economist Lombard Wilson Ferrarezi.

“The problem is that the positive data will face significant downside risks in the months ahead.”

Most of Mexico’s five central bank board members believe the balance of risks to the path of inflation has deteriorated again and remains biased to the upside, according to minutes of its latest policy meeting. monetary.

Banxico signaled in its statement that it may implement tougher measures to bring inflation back to its target levels,” the Commerzbank strategists wrote in a note.

“A good number of market participants seem to be expecting a bigger rate hike in June. This means that a lot of things seem to have already been priced in, which is also reflected in the robust peso.”

The Mexican peso gained 3.3% this month, on track to erase all of April’s losses.

The Brazilian real BRL= pink 10.6% against the dollar. Brazil’s federal tax revenue in April beat expectations by hitting its fifth straight record, the data showed.

The Colombian peso COP= addd 00.4%, up for its third consecutive session, as crude prices extended their rally on signs of tight supply. OR

A weak dollar = USD also helped Latam lift currencies after Wednesday’s minutes from the Federal Reserve’s May meeting contained few surprises. XRF/

The Chilean peso CLP= and Peruvian soil PEN=each pink 00.9% despite weakness copper prices on lingering concerns about COVID-19 lockdowns affecting economic growth in China, the metals’ top consumer. MET/L

Elsewhere, the South African rand ZAR=reversed early losses to 0.1% higher. The data showed the country’s producer The price index rose 13.1% year on year in April, after rising 11.9% in March.

The Russian ruble RUBUTSTN=MCX saggy 10% against the dollar as the central bank cut interest rates to 11% at an off-schedule policy meeting and suggested further cuts would follow as inflation risks eased. UK/RUB

Major Latin American Stock Indices and Currencies at 1912GMT:

Stock indices

Last

% daily change

MSCI Emerging Markets .MSCIEF

1024.15

0.45

MSCI Latam .MILA00000PUS

2462.79

2.31

BrazilBovespa .BVSP

111997.79

1.28

Mexico IPC .MXX

52192.83

-0.02

Chile IPSA .SPIPSA

5255.55

1.24

Argentina MerVal .MERV

93469.10

2.408

Colombia COLCAP .COLCAP

1507.24

1.06

Currencies

Last

% daily change

Brazilian real BRBY

4.7578

1h30

mexican peso MXN=D2

19.7688

0.25

chilean peso CLP=CL

822.8

1.08

Colombian peso COP=

3914.95

0.40

Soil of Peru PEN=PE

3.655

0.85

Argentinian peso (interbank) ARS=RASL

119.4100

-0.25

Argentinian peso (parallel) ARSB=

204

1.96

Mexico retail sales, consumer confidencehttps://tmsnrt.rs/3PN2VtS

(Reporting by Bansari Mayur Kamdar in Bengaluru; Editing by Diane Craft and Richard Chang)

((BansariMayur.Kamdar@thomsonreuters.com;))

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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