Brazil's real drops as Chile's peso hits 9 - month low


Brazil industrial production unchanged in June Peru's Velarde amenable to stay on as cenbank chief MSCI Latam stocks index briefly hits 2 weeks low I Susan Mathew and Ambar Warrick Aug 3 - Brazil's real dropped on Tuesday on flat industrial production data, while Chile's peso hit a nine-month low as weak copper prices and concerns over a strike in Escondida mine weighed. The real dropped 0.8% and hit a two-week low after data showed industrial production changed from the previous month in June, with output being recorded in three of four main economic categories and 14 of 26 sectors surveyed. The stagnation in Brazilian industrial production in June suggests that industry made a positive contribution to global GDP growth during the second quarter as a whole, said William Jackson, Chief EM economist at Capital Economics. But with virus cases dropping sharply, it looks like the prospects for industry and the economy are more generally brighter. Most other currencies fell tracking commodity prices as sentiment was held in check by fears of a hit to aneescent global economic recovery from a rise in COVID - 19 cases, especially in other parts of Latam and Asia, as the Delta variant spreads Chile's peso sank as much as 1.9% to a nine-month low of 782.21 Dollar and lagged its regional peers for a second straight day as copper prices fell and investors awaited further updates on the BHP Group's negotiations with the labor union at the Escondida mine. Data also showed that production from the mine, which is the world's largest copper mine and a major contributor to Chile's economic growth, fell for an 11th straight month. Carry trade appeal helped Mexico's peso edge mildly into positive territory, although a drop in crude prices moderated gains. Hawkish cues from the central bank have also helped keep prospects for the peso from falling. The Peruan sol recovered from a record low of 4.0844 against the dollar, although political uncertainty prevailed after the appointment of a moderate prime minister and far-left finance minister. Julyo Velarde appears amenable to a proposal to stay in his position under the Peruvian central bank president, said the Economy Ministry. Most regional stocks fell, with MSCI's index of Latam stocks briefly touching a two-week low. Sentiment remains on edge due to Delta variant. Vale nickel miner rose nearly 3% after the company reached a tentative agreement to settle a labor dispute at its steel mill in Sudbury, Canada.