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EMERGING MARKETS-Brazil currency falls as Temer faces fresh graft probe
September 13, 2017 / 1:55 AM / 2 months ago

EMERGING MARKETS-Brazil currency falls as Temer faces fresh graft probe

(Recasts with Temer graft probe, updates prices)

By Bruno Federowski

SAO PAULO, Sept 12 (Reuters) - The Brazilian real plunged on Tuesday as a Supreme Court judge authorized a fresh investigation into beleaguered President Michel Temer for suspected corruption.

Justice Luis Roberto Barroso authorized the investigation of Temer on suspicion of graft charges involving a decree regulating ports, adding to corruption allegations the president has so far parried with backing from Congress.

Brazil’s currency, the real, posted its biggest daily drop in nearly a month, slipping 0.8 percent against the U.S. dollar as the investigation and a separate police probe into Temer’s allies kept pressure on the president.

Temer’s lawyer said in a statement sent to the Supreme Court that the allegations against the president are “contaminated by untruths and malicious distortions.”

The country’s benchmark Bovespa stock exchange, however, rose 0.3 percent. It rose as much as 1.2 percent during the session, but still managed to end the day hitting an all-time high after setting a record the day before.

Shares of state-owned power utility Centrais Elétricas Brasileiras SA rose 1.80 percent, after the government said it will release a privatization model for the firm this month.

Cia Energética de Minas Gerais SA, Brazil’s No. 3 power utility, also contributed to the gains.

Cemig, as the company is known, could join with miner Vale SA to bid for a number of hydropower dams in an upcoming auction, Vale told Reuters.

Other Latin American markets seesawed, with the Mexican peso slipping 0.37 percent.

The Chilean peso closed almost flat, as traders booked profits on its recent rally despite rising prices of copper. (Reporting by Bruno Federowski; Editing by Andrea Ricci and Lisa Shumkaker)

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