Reuters logo
EMERGING MARKETS-Brazil rate futures fall as inflation slumps
February 8, 2017 / 3:10 PM / 10 months ago

EMERGING MARKETS-Brazil rate futures fall as inflation slumps

By Bruno Federowski
    SAO PAULO, Feb 8 (Reuters) -    Yields paid on Brazilian
interest rate futures fell on Wednesday after consumer inflation
slowed more than expected last month, boosting rate cut bets.
    The official measure of consumer prices rose 0.38 percent in
January from December, the smallest increase for the month since
1994. 
    The figures reinforced bets that the central bank will once
again cut the benchmark overnight lending rate by 75 basis
points in a meeting later this month, to 13 percent.
    According to Reuters calculations, rate future yields
indicated a 90 percent chance of a 75 basis-point cut and a 10
percent probability of a steeper 100 basis-point reduction.
 
    "In our view, the pace of a 75 basis-point cut per meeting
adopted by the Central Bank in last January's Copom meeting is
enough to ensure inflation to the target in the next two years,"
UBS economists wrote in a note to clients.
    Brazil's benchmark Bovespa stock index slipped 0.4
percent, weighed down by falling shares of state-controlled oil
company Petróleo Brasileiro SA.
    Crude futures extended a recent slump on Wednesday, reacting
to an increase in U.S. inventories and a slump in Chinese
demand. The move also helped dent demand for assets from
oil-heavy economies, such as Colombia's peso.

    Key Latin American stock indexes and currencies at 1440 GMT:
 Stock indexes                            daily %    YTD %
                                           change   change
                               Latest              
 MSCI Emerging Markets            920.02     0.02     6.67
                                                   
 MSCI LatAm                      2518.15    -0.02      7.6
                                                   
 Brazil Bovespa                 64004.51     -0.3     6.27
 Mexico IPC                     46666.61    -0.13     2.24
 Chile IPSA                      4252.36    -0.13     2.43
                                                   
 Chile IGPA                     21221.60    -0.13     2.35
 Argentina MerVal               19147.79    -0.24    13.18
                                                   
 Colombia IGBC                  10098.13    -0.31    -0.30
                                                   
 Venezuela IBC                  28260.26    -0.05   -10.87
                                                          
 Currencies                               daily %    YTD %
                                           change   change
                                  Latest           
 Brazil real                      3.1269    -0.33     3.91
                                                   
 Mexico peso                     20.5520     0.36     0.93
                                                   
 Chile peso                        644.8     0.09     4.02
                                                   
 Colombia peso                   2875.18    -0.82     4.39
 Peru sol                          3.293     0.06     3.67
                                                   
 Argentina peso (interbank)      15.6750     0.10     1.28
                                                   
 Argentina peso (parallel)         16.44     0.30     2.31
                                                   
 

 (Reporting by Bruno Federowski, Editing by Franklin Paul)

Our Standards:The Thomson Reuters Trust Principles.
0 : 0
  • narrow-browser-and-phone
  • medium-browser-and-portrait-tablet
  • landscape-tablet
  • medium-wide-browser
  • wide-browser-and-larger
  • medium-browser-and-landscape-tablet
  • medium-wide-browser-and-larger
  • above-phone
  • portrait-tablet-and-above
  • above-portrait-tablet
  • landscape-tablet-and-above
  • landscape-tablet-and-medium-wide-browser
  • portrait-tablet-and-below
  • landscape-tablet-and-below