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More pressure for the peso: the region’s currencies were devalued due to the global advance of the dollar

More pressure for the peso: the region’s currencies were devalued due to the global advance of the dollar

The region’s currencies suffered widespread losses this Tuesday, something that adds pressure to the Argentine peso in the financial marketin the middle of a global advance of the dollar and with the Market attention focused on data from the US economy in search of clues about future movements in interest rates in the world’s leading economy.

The session marked a new decline in the Mexican peso after the presidential elections this weekend. The publication of a report from the ADP employmentwhile on Friday the creation of non-agricultural employment will be announced, a data highly anticipated by the markets.

“The employment data that will be released this week is extremely important to obtain clues about the next movements of the (Federal Reserve) Fed in relation to interest rates, after the weak manufacturing data that was released yesterday (Monday) and that raised doubts about the health of the US economy”, said an operator.

Meanwhile, job offers in the United States fell more than expected in April, to the lowest level in more than three years, a sign that labor market conditions are softening in a way that could help the Federal Reserve’s fight against inflation.

For its part, the greenback gained just over 0.1% against a basket of six major currencies that make up the dollar index, recovering part of the losses suffered the day before.

Colombia’s currency, the peso, led the losses and closed with a drop of 1.84% to 3,936.70 units per dollar. while on the stock market, the MSCI COLCAP benchmark index rose 0.29% to 1,404.04 points, after a holiday that kept the markets closed on Monday.

For its part, The Mexican peso extended the strong losses of the previous day, briefly challenging the barrier of 18 per dollar, due to investor concerns that a qualified majority of the ruling party in the next Congress will bring profound constitutional reforms. The domestic currency was quoted near the close at 17.8624 units, with a depreciation of 1.09%, although earlier it weakened to 18.2010 pesos, a level not seen since October 2023, after losing 4% the previous day. “The fear continues,” said Gabriela Siller, director of analysis at the Banco Base firm.

The main stock index S&P/BMV IPC, which makes up the 35 most liquid companies in the Mexican market, rose 3.24%, to 53,485.62 units, recovering part of the ground lost in the previous day, when it suffered its worst setback since March 2020. On Monday, the stock market fell more than 6% after learning of Claudia Sheinbaum’s overwhelming victory in Sunday’s presidential elections and that her Morena party and allies were poised to dominate Congress.

For its part, the Brazilian real depreciated 0.96%, to 5.2851 units per dollar, amid the fall in raw material prices and market discomfort with the fiscal scenario in Brazil. Meanwhile, the Bovespa index of the B3 stock market in Sao Paulo lost 0.19%, to 121,802.06 points, in its fifth consecutive session of losses, pressured by the papers of the mining company Vale and Petrobras due to the decline in values. of raw materials.

Brazil’s economy recovered in the first quarter from a sluggish second half of 2023 thanks to higher private investments and household demand amid a strong labor market, official figures showed on Tuesday.

External markets operated in the red due to the evidence that The “exceptionalism” of the US economy may be beginning to fade as manufacturing activity weakens.

The Chilean peso lost a slight 0.04%, to 904.20/904.50 per dollar, in a day of high volatility. Meanwhile, the leading index of the Santiago Stock Exchange, the IPSA, fell 0.24%, to 6,598.36 units.

The Peruvian currency, the sol, depreciated 0.51% to 3.744/3.748 units per dollar. Meanwhile, the Lima Stock Exchange benchmark fell 2.19% to 770.05 points.

Source: Ambito

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