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Sheinbaum taps Garcia Harfuch as security minister

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Argentina analysts lower inflation forecast for 2024

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MSCI Latam FX index to notch first weekly gain since May

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Latam stocks flat, FX gains 0.3%

(Updated at 03:15 p.m. ET/ 1915 GMT)

By Johann M Cherian

July 5 (Reuters) - Latin American currencies edged

higher on Friday as a softer U.S. jobs report firmed investor

bets on a September rate cut from the Federal Reserve, while

concerns around fiscal stability in the region lingered.

MSCI's index tracking currencies in the region

gained 0.3% against the dollar, set for its

first weekly gain since May 13.

Investors assessed data which showed U.S. jobs growth slowed

and unemployment rose, holding on to bets that the Federal

Reserve might deliver two interest rate cuts in 2024.

Most central banks in Latin America have paused their

monetary easing cycles, as analysts expect the Fed to defer its

first interest rate cut.

Brazil's real advanced 0.4%, on track for a weekly

gain of over 2%. The currency made gains in the last two

sessions after President Luiz Inacio Lula da Silva committed his

government to fiscal stability.

The leader's comments on greater fiscal spending and on the

domestic central bank's stance on restrictive monetary policy

had depressed the real towards the end of the second quarter.

"After a sharp sell-off over the past month, we believe the

market is close to hitting bottom," said Elizabeth Johnson,

managing director, Brazil research at TS Lombard.

"Lula's attacks on Banco Central Governor Campos Neto are

likely to cease for now, but market jitters are only likely to

fully dissipate when a new governor is named."

Mexico's peso edged 0.1% lower, set to snap a

three-session winning streak. President-elect Claudia Sheinbaum

continued to name cabinet officials ahead of taking office on

Oct 1, with Omar Garcia Harfuch set to be her security minister.

Oil producer Colombia's added 0.4% in light trading,

while copper producer Chile lost 0.3%.

Chile's finance minister Mario Marcel said the economy

showed weakness in June, but is expected to improve in the

second half of this year.

On the equities front, a gauge tracking regional bourses

held steady, but was set for a weekly rise of

over 2%.

Brazil's Bovespa traded flat, while Mexican stocks

lost 0.6%.

Argentina's peso traded at 1400 to the dollar in parallel

trade, while the MerVal index rose 0.9%, ahead of a

monetary policy report by the domestic central bank later in the

day.

A central bank survey showed analysts expect annual

inflation to stand at 138.1%, compared with an earlier estimate

of 146.4%.

Key Latin American stock indexes and currencies:

Latin American market prices from

Reuters

Stock indexes Latest Daily %

change

MSCI Emerging Markets 1106.13 0.18

MSCI LatAm 2232.73 0.05

Brazil Bovespa 126214.48 0.04

Mexico IPC 52309.95 -0.66

Chile IPSA 6470.84 -0.94

Argentina MerVal 1627143.65 0.893

Colombia COLCAP 1379.77 -0.36

Currencies Latest Daily %

change

Brazil real 5.4647 0.38

Mexico peso 18.0870 -0.06

Chile peso 936.9 -0.29

Colombia peso 4076.21 0.37

Peru sol 3.7804 -0.03

Argentina peso (interbank) 915.0000 -0.11