Reducing the bets that Federal Reserve in the United States will cut interest rates in September contributed to the decline of the main currencies in the region. The Brazilian real depreciated 1.28%, to 5.3221 units per dollar, while the Bovespa index of the San Pablo B3 stock exchange It lost 1.72%, to 120,781.90 points.
In what context do Latin American currencies fall?
U.S. job growth accelerated much more than expected in May, keeping the Federal Reserve on track to refrain from cutting interest rates until September at the earliest.
The Labor Department’s employment report on Friday also showed that the unemployment rate rose to 4.0% from 3.9% in Aprilbreaking a symbolic threshold below which the unemployment rate had remained for 27 consecutive months.
Although the labor market has relaxed in recent months, Its strength allowed the Fed to take its time deciding when to start reducing borrowing costs.
Following the report, which showed that employers added 272,000 jobs last month, rate futures imply only a 52% chance of a September rate cutwhich compares to 69% before this information was released.
“This success (of nonfarm payrolls) makes it more difficult for the Fed to move toward an interest rate cut”Toggle AI’s Giuseppe Sette wrote in emailed comments. “The next few months will be interesting as the Fed will have to deal with the improved performance of the US economy, which will limit its ability to follow the European Central Bank’s lead and cut.”
In that context, The US currency rose around 0.8% against a basket of six major currencies that make up the dollar index.
What happened to the Brazilian real this Friday, June 7
The Brazilian real depreciated 1.28%, to 5.3221 units per dollar, while the Bovespa index of the Sao Paulo B3 stock exchange lost 1.72%, to 120,781.90 points.
The director of International Affairs of the Central Bank of Brazil, Paulo Picchetti, said on Friday that It is premature to talk about a possible increase in interest rates at this time.
How the Latin American markets closed this Friday, June 7
He Mexican peso It accelerated its losses and depreciated 2.08% near the close to 18.3403 per dollar, in a volatile day while investors assimilated the data from the United States, while inflation in Mexico increased less than expected.
The peso weakened 2.73% on Thursday after a pro-government legislator opened the door for the debate on constitutional changes to begin and could be voted on as soon as September, when the new legislature, which will be dominated by ruling party and allies.
But later Claudia Shienbaumwho swept the presidential elections on Sunday, came out to qualify the comments by saying that the route of the reforms had not yet been drawn up and that dialogue would be encouraged.
The main stock index S&P/BMV IPCwhich make up the 35 most liquid companies in the Mexican market, gave up initial gains and fell 2.72%, to 52,998.01 units, although it was set to end the week with accumulated losses due to political uncertainty.
He Chilean peso fell 1.35%, to 920.20/920.50 per dollar. Meanwhile, the leading index of the Santiago Stock Exchange, the IPSA, fell 0.74%, to 6,638.57 units.
Chilean consumer prices advanced slightly above expectations in Maya record that would not stop cuts in the key interest rate but could reduce the magnitude and speed of the adjustments, according to analysts.
The state National Institute of Statistics (INE) reported on Friday that inflation was 0.3% in the fifth monthdriven mainly by transportation and clothing, which accumulated an increase of 4.1% in 12 months.
He Colombian peso It closed with a slight increase of 0.06% to 3,932.30 units per dollar, while on the stock market, the MSCI COLCAP reference index gained a slight 0.1% to 1,411.99 points.
Peruvian markets remained closed on Friday as a result of a local holiday.
Source: Ambito
