* Agrentina’s Milei taps ex-central banker Caputo * Petrobras down on renegotiation of refinery sales pact * EM FX index touches 18-month high * Latam Stocks down 0.4%, FX off 0.5% (Updated at 3 ET/2000 GMT) By Shubham Batra and Lisa Pauline Mattackal Nov 29 (Reuters) – Latin American stocks and currencies dipped on Wednesday as investors turned cautious after a rise in the U.S. dollar, with MSCI’s gauge of the region’s currencies down 0.5% and set to log its worst day in three weeks. Emerging market currencies came under pressure as the U.S. dollar rallied off its lowest level in more than three months after data showed the U.S. economy expanded faster than expectedin the third quarter. MSCI’s index of emerging market currencies pulled back from 19-month highs hit earlier in the day, while Colombia’s peso was Latin America’s biggest decliner, falling 1.2% in its biggest daily decline in over a week. Mexico’s peso slipped 0.7% after its central bank upwardly revised its forecasts for 2023 and 2024 economic growth, but noted inflation would take longer than previously projected to its target. Stocks were up 0.8%. Chilean peso slipped 0.1% against the dollar. Chile’s unemployment rate remained unchanged at 8.9% in the quarter to October, versus the 8.8% expected by economists polled by Reuters. Its benchmark stock index climbed 0.3%. “The uptick in the unemployment rate from a year ago has been driven more by a recovery in the participation rate than a deterioration in the labor market,” economists at Goldman Sachs said in a note. Brazil’s real slipped 0.3% after the central bank established new procedures for banks which imply an increase of 34 billion reais ($6.98 billion) in the total capital requirements of the financial system. Argentina’s peso was down 0.1% against the dollar as president-elect Javier Milei met with top U.S. officials and his economic team huddled with IMF officers as the president-elect seeks to formulate a plan to lead the country’s economy out of crisis. Argentina’s Merval index recovered some of its losses of the last two sessions, climbing 2.5% but remains 13% lower this week after gaining over 40% in the previous week. Emerging market assets are set for a strong November, and expected to see a rally through the year-end as U.S. Treasury yields slipped to multi-month lows on growing optimism about an interest rate cut from the Federal Reserve in early 2024. Latam regional stocks declined in early trade, dropping 0.6%. Brazil’s Bovespa index was down 0.2%, while the shares of Petrobras fell 1.2% after the state-run firm filed requests to local competition regulator Cade to renegotiate terms stipulating the company must sell some of its oil refining and natural gas assets. Key Latin American stock indexes and currencies at 2000 GMT: Latest Daily % change MSCI Emerging Markets 982.54 -0.3 MSCI LatAm 2458.48 -0.39 Brazil Bovespa 126344.07 -0.15 Mexico IPC 52749.83 0.75 Chile IPSA 5792.78 0.28 Argentina MerVal 793230.87 2.561 Colombia COLCAP 1134.74 0.61 Currencies Latest Daily % change Brazil real 4.8880 -0.05 Mexico peso 17.2511 -0.67 Chile peso 868.1 -0.12 Colombia peso 3992.26 -1.12 Peru sol 3.722 -0.15 Argentina peso 359.9500 -0.11 (interbank) Argentina peso 905 4.42 (parallel) (Reporting by Shubham Batra and Lisa Mattackal in Bengaluru; Editing by Alexander Smith and Nick Zieminski)
