Brazilian Real falls on pension reform chaos, Latam stocks end lower

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Brazilian Real falls on pension reform chaos, Latam stocks end lower

On Friday, the 14th of June 2019, a basket of Latin American stocks had followed the footprints of Wall St., which had winded down the day lower ahead of a fed rate decision scheduled to be released by next Wednesday, June 19th, GMT.

18.30, while the Brazilian Real had been down just a notch shy of 0.99 percent as investors were spooked following a growing chaos over the nation’s pension reform policy. Aside from that, while investors seemed to be cautious ahead of latest US Central Bank rate decision, which might even experience a first rate cut in years, Latin American stocks fell more than 2 percent on Friday’s (June 14th) market closure.

Besides, the Brazilian lira fell about 1 percent after the country’s economy minister had expressed his disappointment over the progress of pension overhaul. Adding that the Brazilian Economy Minister’s comment had added to investors’ worry over the pension reform and dragged Real down, an emerging market strategist at UBS Global Wealth Management, Alejo Czerwonko said, “It's (Guedes' comments) making investors nervous and leading to some weakness in the real.

This should be interpreted as a part of the ebbs and flows in the approval process and ultimately doesn't alter the baseline scenario that a reform will be approved this year”. Meanwhile, the Mexican Peso kept gaining and added 0.3 percent more on Friday’s (June 14th) market wind up over announcement of a deal between US and Mexico on illegal immigrant issue.

Citing statistics, the MSCI’s gauge of emerging market index had shed 0.78 percent of Friday’s (June 14th) market wrap up, while Argentine Peso had been the worst-performing currency with a tumble of 1.32 percent against the American dollar.

While the regional MSCI’s index of Latam shares had shed 1.69 percent, elsewhere in Latin America, Brazilian bourse was down by 0.97 percent, Mexico IPC had rounded off the day 1.05 percent lower, while Chile stock exchange was down by 0.56 percent.