EMERGING MARKETS-Peru's sol slips as mining protests dent sentiment

  • 11/2/2021
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* Mexico"s peso breaks 5-day losing streak in thin trade * Chile"s right-wing presidential candidate leads in polls * Brazilian, Mexican stock markets closed for holiday (Adds details, updates prices) By Susan Mathew and Ambar Warrick Nov 2 (Reuters) - Mexico"s peso limped off a six-month low on Tuesday in thin holiday trade, while Peru"s sol tumbled as the central bank warned that recent mining protests could hurt investor sentiment towards the country. The sol fell 0.7% amid a wave a protests against Peru"s key mining sector, which central bank head Julio Velarde said were affecting the "country"s perception in terms of future investments". Peru"s largest copper mine, Antamina, suspended operations on Sunday following several days of roadblocks. The protests have caused supply disruptions in the global copper market, and have also damaged the sol this year by denting Peru"s copper exports. Chile"s peso lost 0.1% as copper prices fell on caution ahead of a Federal Reserve policy decision due on Wednesday. With a presidential election scheduled for later this month, Chile"s right-wing presidential candidate, José Antonio Kast, is pulling ahead in opinion polls, though he is still seen losing a likely second-round run-off against a candidate from the left. Central bank data on Tuesday showed Chile"s economic activity jumped 15.6% in September versus the same period in the previous year. Santiago-listed stocks broke a three-session losing streak to rise 1.6%. Markets in Brazil were closed for a local holiday. Stock markets in Mexico remained shut, while the peso firmed 0.3% after tumbling to its weakest level since late-April. Investors are now awaiting the Fed"s policy decision, with the U.S. central bank expected to announce that it is beginning the tapering of its bond-buying program. Massive stimulus from global central banks helped economies during the coronavirus pandemic, and kept flows into riskier emerging market assets. With prices surging across the globe, central bankers face the challenge of balancing inflation containment without choking economic growth, with Brazil being a prime example. "As (the Fed) had already given an idea of the tapering process at the September meeting, we are unlikely to see any major surprises. What is therefore decisive for the market is what signals the Fed provides on a first rate hike," You-Na Park-Heger, FX and EM analyst at Commerzbank wrote in a note. Colombia"s peso fell 1%, tracking losses in oil markets. Key Latin American stock indexes and currencies: Latest Daily % change MSCI Emerging Markets 1262.86 -0.13 MSCI LatAm 2125.26 0.24 Chile IPSA 4196.81 2.56 Argentina MerVal 88737.59 1.46 Colombia COLCAP 1392.47 -0.11 Currencies Latest Daily % change Mexico peso 20.7622 0.33 Chile peso 812 -0.10 Colombia peso 3794.53 -0.98 Peru sol 4.0077 -0.71 Argentina peso 99.8500 -0.03 (interbank) (Reporting by Susan Mathew in Bengaluru Editing by Paul Simao)

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