EMERGING MARKETS – Latam FX, stocks rally as US jobs data dampens Fed hike bets


* US jobs rose slightly more than expected in August * Reject vote on Chile’s new constitution to appease market analysts * Brazil’s industrial production rises in July from June (adds details, puts updated prices throughout) By Shreyashi Sanyal Sep 2 (Reuters) – Latin America currencies and stocks rose at the end of a tumultuous week on Friday after a key U.S. jobs report reported raised hopes that the Federal Reserve might slow its cycle of aggressive policy tightening. The MSCI Latin American Currency Index gained 1.1%, outperforming the broader Emerging Markets FX Index, which was flat. The Brazilian real and the Mexican peso rose more than 1% each. Data showed U.S. employers hired slightly more workers than expected in August, although the unemployment rate rose to 3.7%, taking some of the shine off the U.S. dollar and favoring riskier assets. “The overall NFP figure was a bit higher than expected at 315,000, which may have created this initial unease, as a KO report would have effectively paved the way for a 75 basis point rate hike this month- ci,” said Craig Erlam, principal market analyst at OANDA. . “But once you dig a little deeper, there are aspects of the report that will please the Fed and support the case for loosening the brake.” Latin American stocks rose 2%. After a lackluster performance in August amid monetary policy tightening by central banks around the world and volatile commodity prices, investors will now focus on the upcoming US Federal Reserve meeting in September. . Brazilian stock markets rose 0.8% after data showed industrial production rose 0.6% in July from June, slightly below market expectations but enough to offset the 0.0 drop. .3% observed the previous month. Brazilian steelmaker Gerdau SA and heavy vehicle parts maker Randon SA rose 3% and 1.5%, respectively, as they announced on Thursday evening that they had agreed to form a strategic partnership to provide truck rental services and semi-trailers. The Chilean peso rose 1.5% as stocks in the region gained 3% ahead of a historic vote on its new constitution on Sunday. Chileans will choose between sticking to a market-friendly constitution dating back to military dictator Augusto Pinochet or endorsing a progressive new text that promises to shake up the political and social fabric of the Andean country. “From a market perspective, the reject option appears to be the preferred one, given all the criticism of the proposed new constitution,” said Alonso Cervera, managing director of Credit Suisse. “Regardless of the outcome, political uncertainty will likely persist given the strong consensus on the need for a new constitution. This uncertainty makes a complex economic outlook even more complex.” Main stock indices and currencies in Latin America at 1906 GMT: Stock indices Last daily change in % MSCI Emerging Markets 971.80 -0.44 MSCI LatAm 2168.24 2.05 Brazil Bovespa 111294.96 0.81 Mexico CPI 45944, 71 1.24 Chile IPSA 5600.89 3.57 Argentina MerVal 0.00 123 Colombia COL % change Brazilian real 5.1648 1.41 Mexican peso 19.9589 1.05 Chilean peso 882.5 1.52 Colombian peso 4479 .45 0.03 Peruvian Sol 3.8715 -0.70 Argentine Peso (interbank) 139.0200 -0.21 Argentine Peso (parallel) 281 3.20 and Andrea Ricci)


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