EMERGING MARKETS-Latam shares soar; inflation in Brazil, Mexico exceeds expectations

* Mexico early January costs exceed market forecasts * Venezuela’s inflation slows to 234% in 2022, vice chairman says * Brazil inflation barely increased than forecast in early January * Shares up 1.1%, currencies up 0.4% (Updates costs, provides economist’s remark) By Bansari Mayur Kamdar and Amruta Khandekar Jan 24 (Reuters) – Latin American shares prolonged good points for the third straight session on Tuesday, whereas traders assessed inflation information from Brazil and Mexico and awaited a lot of rate of interest choices from central banks within the area. The MSCI’s index for Latin American shares jumped 1.1%, outperforming a 0.2% rise within the broader EM shares index. Brazil’s Bovespa index rose 0.5% although good points have been restricted by a close to 1% fall in shares of Brazilian state-run oil firm Petrobras which stated it will improve refinery gate gasoline costs. Latin America’s currencies index added 0.4percentwith the Brazilian actual up 1% towards the greenback and near its session excessive. Knowledge confirmed Brazil’s annual shopper costs got here in barely above market expectations within the month to mid-January, as policymakers in Latin America’s largest financial system work to decrease inflation to the central financial institution’s goal. In Mexico, headline inflation accelerated and exceeded expectations in early January, information from the nationwide statistics company confirmed, marking the primary month-to-month pickup since September as markets brace for recent rate of interest hikes forward. Analysts stated a 25 foundation level charge hike was doubtless from the Mexican central financial institution at its February assembly. The Mexican peso was flat towards the greenback, whereas shares in Mexico rose 1%. Elsewhere in Latin America, prime copper exporter Chile’s peso jumped 1.6% to hit an over nine-month excessive towards the buck whereas oil exporter Colombia’s peso rose 1.1%, even towards lacklustre commodity costs. Buyers are awaiting financial coverage choices from the central banks of each international locations later within the week, with Chile being the primary to ship its rate of interest choice on Thursday. “Hypothesis that briefly in-built late 2022 that the central financial institution of Chile might reduce in January has been carried out away with given comparatively elevated inflation. Our official view is that the central financial institution will do a slight reduce however we will not rule out a maintain,” stated Juan Manuel Herrera Betancourt, senior economist at Scotiabank. “As for Colombia, there’s a very robust likelihood that they are going to hike by 100 foundation factors on Friday. This transfer is towards very steep inflation in Colombia that hasn’t proven very clear indicators that it has crested.” In the meantime, Venezuelan Vice President Delcy Rodriguez stated inflation hit 234% in 2022, a slowdown from the earlier 12 months, which was greater than 686%, in keeping with the central financial institution. Amongst different rising market friends, Hungary’s forint gained 1.5% towards the euro after the Nationwide Financial institution of Hungary saved its base charge at 13% the best within the European Union, as inflation exhibits no respite. Latin American inventory indexes and currencies at 1940 GMT: Inventory indexes Newest Each day % change MSCI Rising Markets 1040.23 0.15 MSCI LatAm 2316.29 1.12 Brazil Bovespa 112314.71 0.52 Mexico IPC 54937.34 1.1 Chile IPSA 5256.53 -1.04 Argentina MerVal 248988.80 -0.549 Colombia COLCAP 1315.98 -1.19 Currencies Newest Each day % change Brazil actual 5.1447 1.04 Mexico peso 18.8103 -0.05 Chile peso 800 1.55 Colombia peso 4505.25 1.14 Peru sol 3.893 -0.74 Argentina peso 184.6800 -0.17 (interbank) Argentina peso 377 -0.27 (parallel) (Reporting by Bansari Mayur Kamdar and Amruta Khandekar in Bengaluru Enhancing by Alistair Bell and Grant McCool)