* Colombia's c.bank keeps interest rate unchanged at 13.25% * Brazil's jobless rate drops to 8.3% in quarter through May * Argentina makes IMF payment
* Colombia’s c.bank keeps interest rate unchanged at 13.25% * Brazil’s jobless rate drops to 8.3% in quarter through May * Argentina makes IMF payment as deal talks grind on * Bolsonaro barred from office until 2030 * Colombian peso leads Latam FX higher in first-half of 2023 (Updated at 1845 GMT) By Shreyashi Sanyal and Bansari Mayur Kamdar June 30 (Reuters) – Latin American currencies and stocks gauges outperformed broader emerging markets in the first half of the year, while Colombia’s peso ticked higher on Friday after its central bank held interest rates steady. The MSCI’s index for Latam currencies has risen 17.4% in the first sixth months of 2023, while its stocks counterpart has jumped 15.8%. The MSCI’s broader gauge for emerging market stocks added 3.6% in the six months up to June, while its FX index gained just about 1%. Colombia’s peso led the advance among Latam currencies in the first-half, strengthening nearly 14%. The currency has benefited from optimism around a likely delay in leftist President Gustavo Petro’s proposed social reforms as he weathers a political scandal. The currency edged 0.1% up on Friday after Colombia’s central bank held the benchmark interest rate for the first time in nearly two years, amid cooling inflation and as the market anxiously awaits signs of when policymakers may begin to cut rates. Latin American investors are hopeful that major central banks in the region, which have led some of the most aggressive tightening over the last two years, may be poised to lead the world on interest rate cutting amid clear signs of slowing inflation in places like Chile and Brazil. “It now feels like the bar for not hiking in August is pretty high,” said Kimberley Sperrfechter, emerging market economist at Capital Economics. “And it would require nasty upside surprises in the inflation figures in July (unlikely), congress derailing the government’s fiscal plans (also unlikely) and/or a sharp fall in the real.” Brazil’s real rose 1.5% against a weakening dollar after U.S. economic data showed a cooling in consumer spending, raising some doubt about the potential aggressiveness of the Federal Reserve. The real is up about 9.5% so far this year. Data showed Brazil’s jobless rate fell for the third rolling quarter in a row in the three months through May, underscoring the strength of the labor market in Latin America’s largest economy despite high interest rates. Brazilian state-run oil company Petrobras fell 4.3% after it said it will reduce the prices of gasoline and cooking gas sold to distributors starting Saturday. Also in Brazil, the federal electoral court (TSE) barred the far-right former President Jair Bolsonaro from public office until 2030 for his conduct during last year’s fraught election. Copper output in Chile, the world’s largest producer, dropped 14% year-on-year in May to 413,083 tons, the country’s INE statistics agency said. The peso inched 0.2% up. The Mexican peso was also among top gainers in the first half, up about 12%. The International Monetary Fund said that Argentina is current in its payment obligations, and the government said it made a $2.7 billion payment to the fund using its existing stock of the IMF’s reserve assets, and Chinese currency. Latin American stock indexes and currencies: Stock indexes Latest Daily % change MSCI Emerging Markets 990.55 0.35 MSCI LatAm 2464.65 1.35 Brazil Bovespa 118827.30 0.38 Mexico IPC 53678.39 0.17 Chile IPSA 5782.87 0.95 Argentina MerVal 418807.14 0.562 Colombia COLCAP 1132.78 0.16 Currencies Latest Daily % change Brazil real 4.7860 1.24 Mexico peso 17.1248 -0.01 Chile peso 801.4 0.19 Colombia peso 4177.2 0.13 Peru sol 3.6202 -0.02 Argentina peso (interbank) 256.7000 -0.18 Argentina peso (parallel) 489 1.02 (Reporting by Shreyashi Sanyal and Bansari Mayur Kamdar in Bengaluru; editing by Grant McCool and Diane Craft)
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