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Latam FX up 0.8%, stocks up 0.3%

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Mexico's annual inflation speeds up in May, exceeds target

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Chile's May copper exports up 4.4% at $4.48 billion

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Colombian May inflation data later in the day

(Updates to mid-session prices)

By Nikhil Sharma and Pranav Kashyap

June 9 (Reuters) - An index tracking Latin American currencies nudged closer to a record

high on Monday, as investors hoped for a potential breakthrough in the U.S.-China trade

negotiations.

MSCI's index for Latin American currencies ticked up 0.8%, flirting with the

record high achieved back in July 2011.

The move was helped by a softer U.S. dollar, which eased its grip as top officials

from Washington and Beijing converged in London - aimed at defusing the escalating trade

tensions between the world's two economic powerhouses.

The talks aim to revive a preliminary agreement struck last month, which had briefly

relieved investors after weeks of uncertainty unleashed by U.S. President Donald Trump's tariff

policies since his inauguration in January 2025.

This protracted instability has undeniably bludgeoned confidence in U.S. assets, especially

the greenback, compelling investors to seek better investments in emerging markets.

"The USD weakness is clearly helpful for all who manage their currencies vs. the USD. The

tighter the management, the more the benefit," said Rob Brewis, portfolio manager at Aubrey

Capital Management.

High-yielding currencies like the Brazilian real have emerged as prime beneficiaries

- having already jumped 10% so far in 2025.

On Monday, the real took a backseat, dipped marginally, after closing out its strongest week

in over 10 months on Friday. This pullback could mark the end of a five-session winning streak -

its longest in over four months - influenced by a dip in iron ore prices, a critical export for

the South American giant.

Sao Paulo's main stock index pared losses and was last down 0.1%.

Additionally, a gauge of the region's equities rose 0.3%.

Mexico's peso gained 0.3% - set for its fourth consecutive session of advances and

its longest winning streak in a month. However, new data revealed that annual inflation in May

accelerated beyond the central bank's target, potentially complicating its monetary easing

ambitions.

The nation's equity index retreated 0.2%.

Colombia's peso, however, bucked the regional trend, as it slid 0.7%, and its main

stock index COLCAP dipped nearly 1%. Investors are awaiting May's inflation figures,

widely expected to show easing price pressures.

Colombia was thrown into political turmoil after Senator Miguel Uribe, a potential

presidential contender, remained in a critical condition after an assassination attempt where he

was shot in the head during a campaign event on Saturday.

Compounding the unease, mounting fiscal concerns intensified after Finance Minister German

Avila's Friday comments signaled a potential breach of the nation's carefully guarded fiscal

rules.

Chile's peso dipped 0.2%. Data revealed that copper exports from the world's biggest

producer of the red metal rose 4.4% year-on-year in May.

The Santiago stock index was flat.

Elsewhere, Peru's sol slipped 0.5% as investors awaited an interest rate verdict due

later this week.

Key Latin American stock indexes and currencies:

Equities Latest Daily %

change

MSCI Emerging Markets 1194.5 0.98

MSCI LatAm 2254.4 0.29

Brazil Bovespa 135898.89 -0.15

Mexico IPC 57956.19 -0.18

Argentina Merval 2124278.4 -1.507

7

Chile IPSA 8173.32 0.04

Colombia COLCAP 1636.12 -0.91

Currencies Latest Daily %

change

Brazil real 5.5632 -0.08

Mexico peso 19.0423 0.29

Chile peso 936.4 -0.24

Colombia peso 4138.29 -0.71

Peru sol 3.6294 0.46

Argentina peso (interbank) 1184.5 0.13

Argentina peso (parallel) 1175 -0.85