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Chile's peso jumps more than 1% against the dollar

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Brazil's central bank boosts 2024 GDP forecast

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Latin American currencies up 0.8%, stocks up nearly 2%

By Ankika Biswas

Sept 26 (Reuters) - Chile's peso led gains among most

Latin American currencies against the dollar on Thursday, riding

on the back of strong copper prices, while investors awaited

Mexico's interest rate decision later in the day.

Chile's peso strengthened more than 1% against the

greenback, hitting its highest level since early June, as copper

prices surged to 3-1/2-month highs. Peru's sol also

gained 0.4%. Chile is the largest producer of the metal, while

Peru is the second-largest.

The MSCI Latam currencies index rose 0.8% to

a one-week high, while the index tracking emerging market stocks

jumped more than 2% to a fresh two-year high, with

Chinese and Hong Kong stocks leading gains.

Metal prices rose across the board as top metals consumer

China pledged fresh stimulus measures, strengthening the demand

outlook.

Prices of iron ore futures also extended gains into a third

straight session, likely supporting the Brazilian real,

which gained 0.6% against the dollar.

Brazil's central bank raised its 2024 economic growth

forecast to 3.2% from 2.3% and said it expects the economy to

grow 2% in 2025, according to a quarterly inflation report.

The report emphasized that the increase in inflation

projections across the central bank's relevant horizon "resulted

primarily from stronger-than-expected economic activity, which

led to a rise in the estimated output gap, currency

depreciation, and higher inflation expectations."

"In Brazil, BRL trades are better after selling off on

fiscal news last week, with terms of trade and a softer CPI

(consumer price index) print than expected enough to halt ...

the DI (domestic investor) sell-off," Citi analysts noted.

Mexico's peso gained 0.4% amid expectations that the

central bank on Thursday will cut interest rates by 25 basis

points.

Brazil's central bank hiked rates earlier this week while

the U.S. Federal Reserve delivered a larger-than-usual

50-basis-point rate cut last week.

However, a more than 3% slide in oil prices, owing to the

prospect of Saudi Arabia raising output, pulled Colombia's peso

down 0.2% and also capped gains in the Mexico's peso.

The MSCI stocks index also jumped nearly 2%

to a one-week high, led by Brazilian stocks.

Elsewhere, the Turkish Central Bank said leading indicators

suggest monthly consumer inflation will slow in September, while

inflation expectations and pricing behavior continue to pose

risks to the disinflation process.

HIGHLIGHTS:

** Nigeria's central bank sells FX at 1,590 naira per dollar

to exchange bureaus

** Polish central banker Kotecki sees up to 100 bps of cuts

in 2025 - Bloomberg

** China to issue $284 bln of sovereign debt this year to

help revive economy, sources say

Key Latin American stock indexes and currencies at 1352 GMT:

Equities Latest Daily % change

MSCI Emerging Markets 1161.01 2.13

MSCI LatAm 2279.39 1.58

Brazil Bovespa 132781.65 0.91

Mexico IPC 53474.26 0.5

Chile IPSA 6477.3 0.57

Argentina Merval 1744131.22 NULL

Colombia COLCAP 1322.03 0.06

Currencies Latest Daily % change

Brazil real 5.4444 0.6

Mexico peso 19.555 0.35

Chile peso 901.8 1.14

Colombia peso 4214.07 -0.23

Peru sol 3.7337 0.39

Argentina peso (interbank) 968 -0.258264463

Argentina peso (parallel) 1220 2.049180328